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Since this tutorial is part of SAP PP training, we will discuss SAP PP material master that
comprises of all the views that are used by production and planning departments of an
enterprise. If you are interested in other views of a material master, check out the following
tutorials:
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Depending on the material type and industrial sector, we can restrict material views and
fields. E.g., material type ROH which is Raw material type enables Purchase, Production
and Accounting views, whereas material type HALB which is semi-finished product enables
Sales, Purchase, Production and Accounting views. The same way industrial sectors will
enables specific fields in Material master. Depending on procurement method of materials
(purchase or production or trading) a suitable material type has to be selected.
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General data
Purchase Data
Sales data
Material Planning data
Production information
Quality Information
Accounting and costing
Material master contains several views which are maintained by the respective
departments. Material master are created for all materials that a company procures,
produces or sells. We can create material master by accessing the following menu path:
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We can also directly access the transaction by typing MM01 transaction code. The system
will show the initial screen of MM01 transaction.
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Next, the SAP system will show the window to choose views of the material master that we
would like to create or edit.
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The transactions mentioned below are used to change and display material master:
Transaction Description
We can also do mass changes of the material master particular fields using transaction
MM60.
Next, let us talk about some of the important fields in MRP and work scheduling views.
MRP Views
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MRP1 View
MRP TYPE
MRP (Material Requirement Planning) procedure in MRP1 view determines how the
material will be planned during MRP run.
Planning procedure “MRP” plans the material according to current requirements. The
requirements may be a sale order, a production plan or a sales plan.
Planning procedure “MPS” also plans the material according to current requirements.
The requirements may be a sale order, a production plan or a sales plan.
The difference between MRP and MPS planning procedure is that MPS material will be
only planned in foreground/interactive mode.
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Material which are critical or used in bottleneck resources or influence the company
inventory cost can be defined as MRP and planned separately.
MRP will not plan MPS item as it needs separate attention of the planner.
Planning Procedure “Consumption based planning” plans the material based on its
historical data or past consumption data.
Example:
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A reorder level of the material will be set based on its past consumption history manually or
automatically (by forecast).
Let say last 6 months average consumption per month was 200 PCS
Maximum Lead time for procuring the material is let say 25 days
Reorder level = Average daily consumption * Maximum lead time of the material
Reorder point will be calculated as (200/30 ) * 25 = 166.666 PCs = 167 PCs
Here reorder level is based on the past 6 month historical data.
In automatic planning scenario, the system will arrive to this reorder level from the
forecast run. But in manual planning scenario, reorder point will be calculated by planner
manually and the value will be manually set in the material master.
Planning time fence is period in days where system will disturb the current planning
situation or existing planning situation. This topic will be explained in details in MRP lesson.
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LOT SIZE
Lot size information here will be used at the time of planning to calculate purchase or
production quantity.
Lot sizing Procedures are here classified based on Quantity, Time and Cost.
Lot Size procedure Static Lot size Period Lot size Optimum Lot size
HB –
Replenishment up
to Maximum stock
level
Depending on the lot size some of the fields are required to be entered.
MRP2 View
Next, let’s have a look at the MRP2 view of SAP PP material master.
PROCUREMENT TYPE
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During material requirement planning (MRP), once the SAP system calculated
procurement (purchase or production) quantity, it will next determine the procurement
method based on “Procurement type”. The following Procurement types are available in
the system:
F External Procurement
E In-house Production
Depending on the procurement type the system will create either a Planned order or a
Purchase requisition.
Here we can define the procurement type more precisely. For example, in the external
procurement the material may be purchased as Subcontractor Consignment stock or stock
transfer from other plant. Examples of special procurement types:
10 Consignment
20 External procurement
30 Subcontracting
40 Stock transfer
50 Phantom assembly
BACKFLUSH
This indicator applicable for BOM components only. This controls the automatic posting of
the components. In Production Planning, we can enter backflush in 3 different levels:
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B AT C H E N T RY
This is also applicable for the component of an assembly or finished goods. If raw material
is batch maintained, when should the batch entry, i.e. batch number assignment for
consumption to be made?
P R O D U C T I O N S T O R A G E L O C AT I O N
D E FA U LT S U P P LY A R E A
This field is used in KANBAN replenishment process. This is an area where material will be
kept for consumption. It helps to create KANBAN control cycle between Vendor and
Production area.
S T O R A G E L O C AT I O N F O R E P ( E X T E R N A L P R O C U R E M E N T )
When system creates Purchase requisition after MRP, this storage location will be
assigned automatically as a receiving location.
IN-HOUSE PRODUCTION
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Number of days required to produce the material. This is based on work days specified in
factory calendar. This is lot size independent, i.e. for any of the order quantity the system
uses this value only.
P L A N N E D D E L I V E RY T I M E
This is number of days required to receive the material, when it is purchased externally
after placing the order. This value is in calendar days.
GR PROCESSING TIME
This is the number of days required for inspection and placing the material in a storage
location. This value is in calendar days.
P L A N N I N G C A L E N DA R
This is useful when we plan materials using time-phased planning. Some materials may be
delivered by the Vendor on specific day or date, e.g. every Wednesday or on the 10th of
the every month, etc. This type of material will be scheduled based on planning calendar.
Planning calendar has to be created in separate transaction (MD25) and assigned here.
We can still add some floats in addition to the material lead times (In-house, Planned
delivery time) using scheduling margin key. This value is in work days. The following floats
are available in Scheduling Margin Key:
Opening Period: days required for planning to start the production after an order is
created
Float before Production: days between scheduled finish date and order finish date
Float after Production days: between order start date and scheduled start date
Release period: days between Start date and Order release date
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S A F E T Y S T O C K C A L C U L AT I O N
Safety stock will be used in case of any sudden or unexpected demand. We can set the
safety stock manually. Also, it can be calculated automatically based on forecasted
value(s).
MRP3 View
P L A N N I N G S T R AT E G Y
In planning section of MRP 3 view, we can define which planning strategy is applicable for
the material. SAP has provided a wide range of planning strategies:
Make to order
Make to stock
Assembly to order, etc.
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AVA I L A B I L I T Y C H E C K
Availability check is based on the scope of check that we define in customizing of SAP
ERP.
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Scope of Check
In the scope of check, we can define which receipts/stocks elements and which issues
elements are considered when we perform availability check. Here are some examples of
receipt/stock elements:
Purchase requisition
Purchase order
Planned orders
Production orders
Safety stock
QI Stocks etc.
Here are some example of issue elements:
Reservation
Sales requirements
Dependent requirement
Sales delivery
Shipping notification
MRP4 View
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Having finished with discussing MRP3 view of SAP PP material master, let us proceed to
MRP4 view.
SELECTION METHOD
In this section, we can control how BOM and routing will be selected when we create a
production order or a planned order or do these activities in MRP. If more than one BOM,
i.e. an alternate BOM is available for a material, we can control its selection:
By its quantity
By explosion date
By production version validity.
COMPONENT SCRAP
Some partial quantity of the components may become scrap at the production due to its
nature or operation nature. These kinds of materials need to be planned in more quantities
than the requirement. Percentages in this field will be used for this purpose at the time of
MRP run.
Example:
Required Planned
Material Demand Stock
quantity quantity
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PC PC PC PC
RAW1 50 100 50
I N D I V I D U A L / C O L L E C T I V E I N D I C AT O R S
This determines whether requirements for this material have to be started individually or
collectively.
This indicator will be only used when assembly or components are planned separately and
we don’t want the system to plan them based on dependent requirements created for
finished material requirements. This applicable only for Make-to-stock production.
D I S C O N T I N U E D PA R T S
This section will be used when you want MRP to plan a different material instead of the
material in subject after effective out date. After this date stocks of this material should not
be exist and the system will replace it by the follow-up material.
This view completely controls the production order and its execution. Some of the
important fields frequently used in any organization are explained here.
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P - S M AT E R I A L S TAT U S
PRODUCTION UNIT
When you want to use a different unit of measurement other that Basic UOM, we can
maintain it here.
PRODUCTION SUPERVISOR
A person responsible for the production activity and scheduling for this material.
We can define which business transactions need to be executed during Production order
processing. For example, printing of shop floor paper which contains operation, raw
materials required, and user instructions after release of the order.
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S E R I A L N U M B E R A N D B AT C H M A N A G E M E N T
If batch or serial number is required for the material, we can define them in this view.
T O L E R A N C E DATA
We can define here, the percentage above or below the quantity that can be posted when
we do goods receipt against production order. Unlimited indicator will allow system to do
GR (goods receipt) irrespective of the order quantity.
In MRP2 view, we defined the in-house production which is lot size independent, i.e. for
any of the order quantity the system uses this value to calculate planned end date. If you
want the system to calculate it with respect to the lot size, we can also define here.
Did you like this tutorial? Have any questions or comments? We would love to hear your
feedback in the comments section below. It’d be a big help for us, and hopefully it’s
something we can address for you in improvement of our free SAP PP tutorials.
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Jerry
August 29, 2017 at 5:22 pm
Kavi
November 24, 2017 at 12:13 am
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For the beginners I believe its well explained and understandable:) Thanks
Velmurugan S
November 24, 2017 at 3:38 am
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