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Sap modules overview and business processes

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  • 1. SAP Financial Accounting (SAP FI)The Financial Accounting (SAP FI) module in SAP is designed to capture organizations businesstransactions in a manner that will satisfy external reporting requirements. Local legal considerations are pre-delivered with the system and the ability to manage and report on multiple companies in multiple countrieswith multiple currencies is part of standard functionality. Integration with Sales and Distribution, Purchasingand Materials Management allows for the ability to select any financial transaction and "Drill Down" to theoriginating transaction whether it is a purchase Order, Sales Order or material movement.Financial Accounting includes the following sub-modules: General Ledger (FI-GL) Accounts Payable (FI-AP) Accounts Receivable (FI-AR) Bank Accounting (FI-BL) Asset Accounting (FI-AA) Funds Management (FI-FM) Travel Management (FI-TV) Special Purpose Ledger (FI-SL) (I am not sure this is really considered a module anymore)The flexibility of the Finance modules organizational structure gives the module the ability to handle anyeconomic situation. Whether a smaller organization with a single legal entity or a large organization withnumerous companies, consolidations and varying legal requirements, the FI module can support andautomate most financial postings and reporting. Below is a listing of the main organizational elements in theFinance module: Company Code - Represents a legal reporting entity. There can be numerous company codes within an organization. Each has its own balanced books and reports itself as a single economic entity. Credit Control Area - If credit management is being used, this sets the general parameters for how credit is managed. The credit control area can control credit for a single company code representing a decentralized credit management approach or multiple company codes representing a more centralized credit management approach. Chart of Accounts - The system supports single or multiple charts of accounts providing the ability to record transactions and report financially in many different regulatory environments. A chart of accounts can support multiple Company Codes if necessary.
  • 2. Business process associated with the SAP FI module:The Finance Module is designed to record financial transactions in a manner consistent with externalreporting. External reporting must be in compliance with a countrys accounting principles and is requiredfor public entities, regulatory agencies and information required by banks and other lenders. The modulealso handles legal consolidations, receivables, payables, fixed assets as well as banking functions if required.
  • 3. SAP Financial Supply Chain Management (SAPFSCM)The Financial Supply Chain Management module (SAP FSCM) includes the following information andprocesses: Credit Management Cash and Liquidity Management Collections Management Dispute Management Treasury and Risk ManagementFSCM provides the ability to have a better view of your corporate cash flow, manage disputes with yourcustomers, and add efficiency to your billing processes.Below, you will find a diagram of the sub-components of FSCM and their key features.
  • 4. SAP Controlling (SAP CO)The purpose of the Controlling (CO) module in SAP is to provide organizations with a method of slicing anddicing data to view costs from an internal management perspective and provide a view of profitabilitybeyond that of basic financial reporting. This allows the organization to create information in a manner thatis tailored to their specific business measurements needs. Controlling allows an organization to: Plan and track overhead costs within the companys specific organizational structure. Track costs related to specific projects or events and either capitalize those costs or charge them to appropriate departments upon completion. Perform "Activity Based Costing". Perform Product Costing, measuring production cost and variances. Report profitability by product line, division, or other internal measurement. Report sales and gross profitability by external measures such as market segments or customer groups.Controlling consists of all master data, configuration, and reporting required to analyze both spend andrevenues, both within and across organizations. This includes the following master data: Cost Elements - cost and/or revenue accounts Cost Centers - departmental units Profit Centers - business lines, product lines or divisions Internal Orders - projects or events Functional Area - Cost of Sales Accounting Statistical Key Figures - non financial statistics for allocating or measuring financial costs Activity Types - Labor or other activity costs
  • 5. Business process associated with the SAP CO module:Subcomponents of the SAP Controlling (SAP CO) Module: CO-OM - Overhead Management - CO-OM-CCA - Cost Center Accounting - CO-OM-OPA - Internal Order Accounting - CO-OM-CEL - Cost Element Accounting - CO-OM-ABC - Activity Based Costing CO-PCA - Profit Center Accounting CO-PA - Profitability Analysis CO-PC - Product Costing
  • 6. SAP Materials Management (SAP MM)The Materials Management module (SAP MM) consists of all master data, system configuration, andtransactions to complete the Procure to Pay process. This process map spans from MRP generatedprocurement proposals through final invoice receipt and verification.SAP Materials Management Components or Sub-Components: Vendor Master and Material Master data Consumption Based Planning Purchasing Inventory Management Evaluation of Materials Invoice VerificationProcure to Pay business process associated with the SAP MM module:
  • 7. Subcomponents of the SAP Materials Management (SAP MM) Module: Purchasing Inventory Management Logistics Invoice Verification Physical Inventory Material Valuation Material Requirements Planning (MRP) External Services Management
  • 8. SAP Sales and Distribution (SAP SD)The Sales and Distribution (SAP SD) consists of all master data, system configuration, and transactions tocomplete the Order to Cash process. It includes the following information and processes: Customer Master and Material Master data Sales Orders Deliveries Pricing Billing Credit ManagementOrder to Cash business process associated with the SAP SD module:
  • 9. Subcomponents of the SAP Sales and Distribution (SAP SD) Module: Master Data Sales Support Pendulum List Indirect Sales Sales Shipping and Transportation Billing Empties Management Credit Management Foreign Trade/Customs Sales Information System
  • 10. SAP Logistics Execution (SAP LE)Logistics Execution covers the areas of Warehouse Management and Inbound Receiving andOutbound Shipping processing.Warehouse Management provides an additional level of stock location detail than SAP InventoryManagement. Inventory Management only maintains stock quantities at the Storage Location level,which is typically an area of your warehouse or a building on your companys campus. WarehouseManagement manages stock down to the bin level, or to the physical coordinates within yourwarehouse. Warehouse Management also provides Picking and Putaway Strategy functionality.The following diagram illustrates a typical Outbound Process using Warehouse Management:
  • 11. SAP Production Planning (SAP PP)Production Planning consists of all master data, system configuration, and transactions to complete the Planto Produce process. It includes the following information and processes: Material Master, Bill of Material, Routing and Work Center data Sales and Production Plans Long Term Planning Demand Management Material Requirements Planning (MRP) Capacity Planning Production Orders KANBANDiagram of the typical Plan to Produce business process associated with the SAP PPmodule:SAP Production Planning (SAP PP) is compromised of the following modules: Master Data - includes the material master, work centers, routings and bill of materials. SOP - Sales and Operations Planning (SOP) provides the ability to forecast sales and production plans based on historical, current and future data. DRP - Distribution Resource Planning allows companies the ability to plan the demand for distribution centers.
  • 12. Production Planning - includes material forecasting, demand management, long term planning andmaster production scheduling (MPS).MRP - Material Requirements Planning relies on demand and supply elements with the calculationparameters to calculate the net requirements from the planning run.Shop Floor Control - includes the processing of production orders, goods movements,confirmations and reporting tools for production.Capacity Planning - evaluates the capacity utilized based on the work centers available capacity toshow capacity constraints.Repetitive Manufacturing - in repetitive manufacturing, the manufacturing process is usuallysimple in that the same products are produced over a long period of time. This module provides thetransactions and business process for companies to run repetitive manufacturing in SAP.KANBAN - is a process of replenishment based on a pull system using KANBAN cards to generatethe replenishment cycle.Product Cost Planning - is the process of evaluating all the time values and value of componentmaterials to determine the product cost.
  • 13. SAP Quality Management (SAP QM)SAP Quality Management (QM) assures that products meet stringent regulatory standards, are safe anduniform, and meet company product specifications. SAP QM processes are thoroughly integrated into themanufacturing process.The Quality Management (QM) process can integrate with the following SAP modules:The Quality Management module covers all classic quality management tasks, such as quality planning(setup of data for QM tasks), quality inspection, and quality control. SAP has several QM terms that areimportant to note. Quality Planning: the creation and management of master data that is required to plan and complete inspections. Quality Inspection: the identification of whether an inspection unit meets specified criteria. Quality Certificates: documents that contain text, value, and inspection results, which are used to certify the material. Quality Notifications: the recording and processing of internal or external problems that result from poor quality. Quality Control: the combination of specification from inspection planning, results from quality inspections, and quality notifications form the basis for quality control. Test Equipment Management: the management of test equipment in the form of master data records in SAP.
  • 14. The following figure shows a sample flow that depicts typical tasks in the Quality Managementprocess flow.
  • 15. SAP Plant Maintenance (SAP PM)Plant Maintenance operates the overall maintenance business processes and functions. The PlantMaintenance module allows a maintenance organization to: Identify, document, and correct failures and degradations of any assets for which they have responsibility. Plan and schedule activities to prevent or predict failures and keep assets and processes operating within design specifications.Both Corrective and Preventative maintenance processes exist in the Plant Maintenancemodule.Corrective maintenance refers to the activities conducted by the Maintenance Organization to repairequipment of all forms within their area of responsibility. Preventive maintenance is a discipline that usesprocesses and activities that focus on the prevention of failures or performance degradation before it occurs.The following diagram illustrates the common process for both Corrective and Preventative Maintenancewithin the Plant Maintenance module:Subcomponents of the SAP Plant Maintenance (SAP PM) Module: Management of Technical Objects - includes master data objects such as functional locations and equipment master records. Maintenance Processing - includes processing steps such as notifications and work orders. Preventative Maintenance - includes maintenance planning and work scheduling tasks.
  • 16. SAP Project System (SAP PS)Project System provides tools to track project milestone, costs and resources. SAPs Project System modulecontains tight integration to the Controlling, Human Resources, and Logistics modules. It utilizes personnelrecords from HR, rolls costs into Controlling and links to materials or customers in the Logistics modules.Two key objects that define the Project in SAP are: Work Breakdown Structure - defines tasks and assign resources to those tasks Network - defines the dependencies within the Work Breakdown Structure (WBS)Common processes in Project System include: Tracking costs against WBS elements. These costs can either be from personnel time charged against the project or from materials and/or services procured to support the project. Tracking milestones against key dates defined in the project.The following diagram illustrates the hierarchy of objects within an SAP Project:
  • 17. SAP Human Resources (SAP HR)The Human Resources module (SAP HR) consists of all master data, system configuration, and transactionsto complete the Hire to Retire (or, as some say, Fire) process. It includes the following information andprocesses.SAP Human Resources (HR) Components or Sub-Components: Personnel Management - Personnel Administration - Recruitment - Organization Structure - Compensation Management - Personnel Development Organizational Management Travel Management Time Management PayrollTypical Hire to Retire business process associated with the SAP HR module: