This document provides an overview of inventory management processes in SAP. It discusses how goods receipts, goods issues, and transfer postings are used to manage material movements both externally and internally. Material documents are generated during goods movements and serve as a record of transactions. Master data such as material, vendor, and purchasing info records must be accurate to ensure efficient transaction processing.

1. July 3, 2016
Inventory Management Overview

2. Course Purpose
This course covers the Inventory Management process to work with transfer
postings, goods movements, inventory, and receipts processes for IM
managed goods.
2

3. Course Objectives
Upon completing this course, participants will be able to:
• Describe key terms for inventory management
• Define the receiving, plant, and issuing processes at the plant
• Understand material movements for IM locations
• Describe how stock is managed at the IM level
• Define common movement types
• Describe the results of goods movements
• Understand the Yaskawa organizational structure
• Discuss master data elements
• Identify the difference between master data and transactional data
• Discuss stock handling tasks
• Understand physical inventory and cycle counts for IM materials
3

4. Agenda
• Lesson 1 – Introduction to Inventory Management
• Lesson 2 – Master Data
• Lesson 3 – Inventory Management Processes
• Lesson 4 – Physical Inventory Overview
4

5. Lesson 1: Introduction to Inventory
Management
Upon completion of this unit, you will be able to:
• Understand Supply Chain Management
• Define master data elements
• Describe goods movements
5

6. Term Definition
MM Materials Management: SAP module that governs processes from
material procurement to vendor payment.
IM Inventory Management: SAP module that allows inventory data to be
captured at the Plant-Storage Location level.
GR Goods Receipt:
A representation of a physical receipt of goods.
GI Goods Issued:
An representation of a physical withdrawal of goods.
SLOC Storage Location: An organizational unit allowing the differentiation of
material stocks within a plant.
PIR Purchasing Information Record: An element of master data that tracks
vendor specific purchasing data for a specific material.
RF Scanner Radio Frequency Scanner:
Device used for accessing warehouse data in real-time.
STO Stock Transport Order:
Physical movement of materials from one plant to another.
SAP Terminology
6

7. SCM Process
The Supply Chain Management Process includes:
– SCM overview
– SCM terminology
– IM vs WM
7

8. Supply Chain Management (SCM) Overview
SCM comprises the following main areas:
INVENTORY
MANAGEMENT
MATERIALS
MANAGEMENT
WAREHOUSE
MANAGEMENT
MATERIAL
REQUIREMENTS
PLANNING
SCM

9. 9
REQ TO CHECK
PURCHASING CONSUMPTION
BASED PLANNING
INVENTORY
MATERIAL STORAGE
GOODS MOVEMENT
HIGHLY
INTEGRATED!
Materials Management
9

10. MRP
Customer
Orders
Purchase
Reqs
Inventory
Operations
Plan
Planned
Orders
Material
Master
Not exclusively a software function:
It is marriage of
people skills, dedication to database accuracy & computer resources.
MRP : A method for the effective planning of all manufacturing resources
Materials Requirement Planning (MRP)
10

11. IM vs WM
• If warehouse stocks are managed with IM, you manage quantities and
values of stocks as if they are in one or several general storage locations.
You get an overview of the:
– Quantity of material in the plant/warehouse
– Value of materials in the plant/warehouse
• WM allows you to map all warehouses in total detail, right down to the
storage bin level
– You can always determine exactly where a certain material is in your
warehouse complex
• IM postings do one or the other of:
– Trigger WM activities (goods receipt, goods issue, transfer posting)
– Mark goods receipt or goods issue as complete
IM is concerned with the value of material.
WM is concerned with exact bin location.
11

12. IM Key Elements
Key elements of the Inventory Management
(IM) system include:
• Brings goods in and out of inventory
(goods movement)
• Interfaces with accounting for
purchasing materials
• Links with material requirements
planning (MRP), purchasing, and
invoice verification
• When goods are received from a
vendor, posts the delivery as a goods
receipt with reference to a purchase
order (PO) and verifies the quantity
and value from the PO against the
invoice
IM is concerned
with quantity
and value.
12

13. WM Key Elements
Most of the activities in Warehouse
Management (WM) are initiated by IM
movements.
Key elements of the WM system
include:
• Provides expanded ability to allocate
materials to bins
• Ensures book inventories in IM
match stock in warehouse
• Is fully integrated into SAP
• Interfaces to:
– Sales and Distribution (SD)
– Quality Management (QM)
– Production Planning (PP)
– Radio Frequency information
collection devices (RF)
WM is
concerned with
quantity and
location (storage
bin).
13

14. Master Data Elements
MASTER DATA IS DATA THAT DOES NOT CHANGE FREQUENTLY
MATERIAL MASTER
VENDOR MASTER
PURCHASING INFO RECORD (PIR)
SOURCE LIST
CONTRACT
14

15. Goods Movements Overview
Load and
ship goods
Receive
goods
Internal procurement:
production
Warehouse
Manage goods
movements
Manage goods
inventory
Receiving Operations Internal Movements Pick/Pack/Ship
External procurement
purchasing
15

16. Movement Types
• Goods Receipt
– Purchase Order
– Work Order
• Goods Issue
– Material withdrawal
– Material Consumption
– Shipment of goods to affiliates
• Transfer Posting
– Stock Type conversion
– Material to material conversion
• Stock Transfer
– Plant to plant
– Storage location to storage
location
– Storage bin to storage bin
• Results of a goods movement:
– Material Document Generated
– G/L Balances – Accounting documents being generated
– Updated Stock Types quantities
– Updated Inventory Balances (quantity and cost)
16

17. Knowledge Check
1. Define the purpose of the IM system.
2. Define the purpose of the WM system.
17

18. Agenda
• Lesson 1 – Introduction to Inventory Management
• Lesson 2 – Master Data
• Lesson 3 – Inventory Management Processes
• Lesson 4 – Physical Inventory Overview
18

19. Lesson 2: Master Data
Upon completion of this unit, you will be able to:
• Discuss plants and storage locations
• Explain master data elements
• Understand master data versus transactional data
19

20. Key Terms
20
Key Term Definition
Master Data Data that remains the same over a long period of time. Master
data contains information that is needed often and in the same
form.
Material
Master
A data record containing all the basic information required to
manage a material. This data is sorted according to various
criteria including data of a descriptive nature (such as size,
dimension and weight) and data with a control function
(Purchasing, MRP, Quality, Costing, Accounting etc.
Material Type A grouping of different materials that have common attributes
with respect to a business function
Plant An organizational unit, serving to subdivide an enterprise
according to Production, Procurement, Maintenance, and
Materials Planning. A plant is a place where either materials are
produced, or goods and services are provided.

21. Organizational Levels
21
Purchasing
Organization
Example:
010
Company Code
Example: Y012
Company Code
Example: Y141
Plant Plant
Storage
Location
Storage
Location
Storage
Location
Storage
Location

22. SAP IM/WM Organization Structure
22

23. Material Master Overview
• A material is defined as a product that a company produces, procures,
sells, or stores
• Detailed information regarding a material is stored in the Material Master
record
• Each material has its own individual Material Master record
• The Material Master record contains data necessary for processing
business transactions
• The Material Master is the company's central source for storing material-
specific data that:
– Provides centralized data
– Eliminates data redundancy and increases data integrity
– Integrates business processes
23

24. Material Master Material Types
Material types are a grouping
together of materials with the same
basic attributes, such as raw materials,
semi-finished products, or finished
products.
Material types have several control
functions that determine the
following:
• Whether the material is procured
through external purchasing or
internal production.
• Which views can be maintained in
the Material Master record
• Whether standard or moving
average price is used for the
material.
24

25. Material Master Record
The Material Master record contains
organization-specific data to meet
the business requirements for
different business functions
• This data is organized in a
hierarchical structure, similar to
the organizational structure of a
company
• Some of the master data is valid
at all organizational levels, while
some data is valid only at specific
organizational levels
25

26. Material Master Record Structure
• A Material Master record is created at
two levels:
– Global data
– Organizational data
• Global Data
is the common information that is
shared across all Yaskawa business
locations
• Organizational Data
is designed to meet the business
requirements of different business
functions
26
 Material number
 Material description
 Base unit of measurement
 Classification
Global Data
 Plant
 Storage Location
 Purchasing organization
 Purchasing group
Organization Data

27. Material Master Record Views
• A Material Master record consists
of several views
• Each view contains data specific to
a business function
• The Material Master record
contains the following fields that
must be maintained or reviewed
for all views:
– Material description
– Base unit of measurement
27
Sales Data
Purchasing Data
Basic Data
Material Master
Material: UCB000598
Material Type: HALB
Industry
Description: CIRCUIT
BREAKER,3P,150A,600V,JDL36150
Unit of Measure EA

28. Material Master Views
28
– MRP 4
– Work scheduling
– General Plant Data/Storage 1
– General Plant Data/Storage 2
– Warehouse Management 1
– Warehouse Management 2
– Quality Management
– Accounting 1
– Accounting 2
– Costing 1
– Costing 2
– Plant Stock
– Storage Location Stock
– CR Additional Data 1
– Basic Data 1
– Basic Data 2
– Classification
– Sales: Sales Org. Data 1
– Sales: Sales Org. Data 2
– Sales: General/Plant Data
– Foreign Trade: Export Data
– Sales Text
– Purchasing
– Foreign Trade: Import Data
– Purchase Order Text
– MRP 1
– MRP 2
– MRP 3

29. Data Maintained in Material Master Views
Basic Data
Sales
Purchasing
Storage
MRP
Accounting
Quality Management
Costing
Yaskawa
Key fields: Material
Description, Weight, Unit of
Measure, Material Group,
Potency Factor
Plant
Key fields: Batch, Material
Group, GR Processing
Storage Location
Key fields: Storage Conditions
Plant
Key fields: Inventory Valuation,
Price
Plant, Sales Org
Key fields: Tax, Pricing
Plant
Key fields: Production
Strategy, Lot Size,
Discontinuation
Plant
Key fields: Product Costing
Methodology
Plant
Key fields: QA Controls in
Procurement & Production
Material Master Record Views
29

30. Exercise 2.1: Display Material Master Record
(MM03)
You need to review a material in your plant.
– Use transaction MM03 to display all of the views for the
material.
30

31. Knowledge Check
1. Which one of the following views of a material master record contains
information relevant for planning the production of a material?
A. Purchasing
B. Classification
C. MRP
D. Sales
2. To which organizational level can MRP data be linked?
A. Plant
B. Client
C. Storage Location
D. Sales Organization
31

32. Material, Vendor Master, PIR
Vendor Master
Name, Address, Phone, tax
information, bank details, reconciliation
account, payment
terms, payment methods, purchasing
control, etc…
Purchasing Info Record
#50000001
Vendor: Vendor Name
Material: Material Number
Purchasing Org: 1000
Conditions:
Price/UOM: $1,600 USD/Palette
Freight: 3%
Payment Terms: 10 Net 30
Discount: 5%
Last PO: 450000034
Purchasing group, net price, Invoice
Verification indicators, delivery tolerances,
etc…
Material Master
Material Name, Material Number,
Material Type, Material Group Material
Description, Unit of Measure, Pricing
Control, MRP information, etc…
32

33. Master Data vs. Transactional Data
33
Master Data Transactional Data
Mostly static Dynamic
The accuracy of master data is
essential to efficient
performance of the system
Accuracy of transactional data is
dependent on master data
Creation of master data is
independent of transactional
data
Master data is a prerequisite for
executing transactional data
Examples: Cost Centers,
Customers
Examples: Sales orders, Invoices

34. SAP Data Levels
• Organization Data: Fundamental
data framework within SAP
– Organizational hierarchy,
tolerances
• Master Data: Static data which
serves as inputs to transactions in
SAP
– Material master, vendor master
• Transactional Data: Dynamic data
representing business events in
SAP
– Enter an invoice, run MRP
Master Data
Transactions
Org.
Structure
34

35. Agenda
• Lesson 1 – Introduction to Inventory Management
• Lesson 2 – Master Data
• Lesson 3 – Inventory Management Processes
• Lesson 4 – Physical Inventory Overview
35

36. Lesson 3: Inventory Management Processes
At the end of this lesson you should be able to
describe:
• Discuss stock overview
• Process goods receipts
• Process goods issues
• Understand transfer requirements
• Process transfer postings
36

37. Stock Overview
Inventory restricted
due to quality
inspections
Inventory
decrease
due to order
fulfillment
Inventory increase
due to order
receipts
Planned inventory
increase due to
outstanding orders
37

38. Display Warehouse Stocks of Material
Use transaction MB52-”Display
Warehouse Stocks of Material” to
identify the inventory that is in Plant
4W, Storage Location QA01 with the
stock type “Unrestricted”.
This combination will be used to
identify material that has been
deemed “acceptable” and should be
putaway in storage.
38

39. Using the Display Warehouse Stocks of Material
Report
• The results for the material display in a list.
39

40. Demo 3.1: Display Warehouse Stocks of Material
(MB52)
• You want to display a material in your plant to determine which location
has the material.
– Use transaction MB52 to display the stock.
40

41. Material Documents
• A material document is generated
when goods movement is posted
• Material documents serve as:
– Proof of movement
– Source of information for any
applications that follow
– A data record for all IM movements
• A material document consists of:
– A header
• Contains general data about movement
(for example, its date)
– At least one item
• Each item describes one movement
41

42. Material Documents
• Every movement of a material has a material document to support it.
• Material documents contain information such as:
– Material(s) associated with the movement
– Movement type
– Plant
– Storage location
– Batch number, if applicable
• You can also view relevant accounting documents such as customer
invoice, material master, document date, and posting date.
42

43. Material Documents
• Generated when goods movement is posted
• Serves as:
– Proof of movement
– Source of information for any applications that follow
• Consists of:
– A header
• Contains general data about the movement (for example, its date)
– At least one item
• Each item describes one movement
43

44. Material Documents
Material documents are necessary to record:
• Stock transfers
• Transfer postings
• Material staging (IM)
• Deliveries for WM staging
44

45. Material Document List
• Use the Material Document List (MB51) to display transaction history for
a material or group of materials.
• Enter one material code or multiple material codes to retrieve all material
documents related to those material codes.
45

46. Demo 3.2: Display Material Document List
(MB51)
• Display a list of documents for a material.
– Watch the demo of transaction MB51.
46

47. Demo 3.3: Display Material Document (MB03)
• You need to display a material document to verify some data.
– Watch the demo of transaction MB03
47

48. Knowledge Check
What is the difference between a material document and a
material master?
48

49. Inventory Storage and Movements Overview
Goods Receipt against
Purchase Order
Receiving
Goods Receipt against
Production Order
Initial Stock
Physical Inventory
DC Returns
Goods Issue against
Outbound Delivery
Issuing
Backflush / GI against
Work Order
Goods Issue to Cost
Center
Physical Inventory
Plant
Internal Movements within the plant:
· From QI to Unrestricted
· Sloc to Sloc
· Bin to Bin
· Consignment to own
...
Stock Type:
· Un-resticted-Use
· Restricted-Use
· Quality Inspection
· Blocked
· In-Transit
49

50. Goods Movements
Goods movements include both external and internal movements. In general
a transaction that causes a stock change is marked as a goods movement.
You can distinguish between goods receipts, goods issues, stock transfers,
and transfer postings.
Once stock is put away in the storage location or storage bin within your
plant, there are several movements that will occur during your shift. You will
use stock transfers to move material in various ways:
• Stock transfers within a plant
– Sloc to Sloc
• Transfer postings within a plant
– Change stock type (Ex Unrestricted to Quality)
– Material to material (Change material number)
• Goods issue to scrap
• Goods issue to a cost center
50

51. Goods Movements
• Goods Receipt
– Purchase Order
– Work Order
• Goods Issue
– Material withdrawal
– Material Consumption
– Shipment of goods to affiliates
• Transfer Posting
– Stock Type conversion
– Material to material conversion
• Stock Transfer
– Plant to plant
– Storage location to storage
location
– Storage bin to storage bin
• Results of a goods movement:
– Material Document Generated
– G/L Balances – Accounting documents being generated
– Updated Stock Types quantities
– Updated Inventory Balances (quantity and cost)
51

52. Movement Types
When you enter a goods movement in the Yaskawa system, you need to
enter a movement type to differentiate between various goods movements.
Examples of movement types used at Oak Creek include:
GR Description GI
101 GR Purchase Ord, Production Ord 261 Goods Issue to an Order
102 GR Purchase Ord, Production Ord
(Reversal)
551 Scrap
Xfer Description TP
311 Storage Loc to Storage Loc 343 Blocked to Unrestricted
311-E Storage Loc to Storage Loc (Sales
Order Stock)
343-E Blocked to Unrestricted (Sales
Order Stock)
301 Plant to Plant 344 Unrestricted to Blocked
344-E Unrestricted to Blocked (Sales
Order Stock)
52

53. External Receiving Putaway Process
53
• When material is received against a Purchase Order, the system
prints a label that specifies the storage location for the placement
of the stock.
• You should always confirm the placement of stock once it is
received into the plant.

54. Demo 3.4: Receive Material from a PO
(MIGO_GR-101)
• You have a PO that needs to be received into stock.
– Use MIGO_GR with movement type 101 to receive stock against a purchase
order.
54

55. Other Goods Receipts
• Yaskawa uses other goods receipts, including:
– STO’s from internal plants
– Customer returns (not returned to customer)
– Customer returns / RMA (repaired and returned to customer)
– “Text PO” – prototypes / samples
– Production receipts
55

56. Goods Issues
• Using a Goods Issue (GI), you can post a material withdrawal, a material
issue, or a shipment of goods to a customer.
• GI results in physical issue of stocks and decrease in stock qty
• The following business transactions normally trigger GI:
Trigger Application WMS Document
Internal Material Consumption
(cost center or scrap)
MM-IM Transfer Order
Material Staging for Production
Orders
Production Transfer Requirement
Delivery to Affiliate Customers or
DC
LE-SHP Outbound Delivery
56

57. Scrap Materials
You might scrap a material if you cannot use it any more, for
example:
• The quality has been reduced due to long storage time.
• It is out of date.
• The material has been destroyed
Entry into SAP is without reference and for the following stock
categories:
• Unrestricted stock
• Quality Inspection Stock
• Blocked stock
57

58. Results of Scrapping Materials
Results of the Post Goods Issue for scrapping are:
• Creation of material document (movement type 551)
• Creation of an accounting document
• Creation of Goods Issue Slip
• Stock Update
• Update of GL Accounts
58

59. Issue Material to Scrap
Material has become
unusable and must be
scrapped.
59

60. Issue Materials to Scrap
60
• Material has become unusable and must be scrapped.
• Use MIGO_GI and the correct movement type to perform the scrap
move.

61. Exercise 3.5: Create Goods Issue to Scrap
(MIGO_GI-551)
• You need to post a manual goods issue to scrap.
– Use transaction MIGO_GI-551 to issue material for scrapping.
61

62. Knowledge Check
1. Which movement type is used to scrap material?
62

63. Pick, Pack, Ship Process Overview
63
VL06N • Find the
delivery
VL71
• Print pack list,
shipping label,
BOL
VL01N
• Create
delivery by
sales order
VL02N
•Post goods issue,
enter freight costs
and tracking info

64. Exercise 3.6: Post Goods Issue for Delivery
Document (VL02N)
You took a Pick List from your local printer and need to enter the picked
quantity and post a goods issue for the outbound delivery. Use transaction
VL02N to enter the picked quantity and process the goods issue.
• Use transaction VL02N to complete the goods issue for a delivery
document.
64

65. Customer Returns Process
• Customer returns are handled by warehouse clerks at the Oak Creek Facility.
• You will create a return sales order and place the material in a quality status.
• If the material will be repaired and returned to the customer, follow the RMA
process to move the material through the repair process and shipped back to the
customer.
65

66. Internal Goods Movements
• Used to remove material from one storage location and place them into
another storage location.
• Both stock transfers and transfer postings consist of a “goods issue” from
an issuing point and a “goods receipt” at a receiving point.
Transfer Description
Storage Location to
Storage Location
A stock transfer from storage location to storage location in the same
plant simply causes an update of the stock quantities in both storage
locations. The stock value remains unchanged, and the event is not
relevant for accounting.
A stock transfer from storage location to storage location is possible for
all stock types.
Plant to Plant A stock transfer from plant to plant not only leads to a change in stock
quantity in both plants; if both plants are assigned to different valuation
areas, an accounting document is also created.
This type of stock transfer can only be carried out from unrestricted-use
stock of the issuing plant to unrestricted-use stock of the receiving plant.
66

67. Transfer Orders
• A transfer order is an instruction to move materials from source storage
bin to destination storage bin within warehouse at a specified point in
time
• Transfer orders contain quantity of material to move
• Transfer orders specify source and destination storage bins
• You can create a transfer order based on a:
– Customer delivery
– Transfer requirement
– Posting change notice
• Transfer requirements (receipt/issue) using MIGO movement types in
Yaskawa creates a material document
– Stocks are updated at the storage location (IM level)
• Transfer requirements create and confirm a transfer order for a material
document
– Stocks are updated at bin level in warehouse (WM level)
67

68. Confirmation of a Transfer Order
• Confirmation of a transfer orders is a required step
• Goods stay in interim storage bin until confirmed
• Transfer orders are used for internal warehouse processes for stock
materials maintained in storage locations (IM level) managed at
warehouse level (IM). A goods movement document posted using
transaction MIGO_TR:
– Creates a transfer order for putaway/picking material automatically created in
WM
– After material is putaway/picked, transfer order must be confirmed
68

69. Knowledge Check
1.Which of these items is part of the WM process flow?
A. Transfer Requirement
B. Confirm Transfer Order
C. Transfer Order
D. All of the above
69

70. Stock Transfers
• From storage location to storage location in the
same plant.
• Move material from Incoming inspection to the
plant.
• Move material from the warehouse to the
Hanels.
• Move material from the Hanels to the shop floor.
– Causes update of stock quantities in both storage
locations
• Stock value remains unchanged
• Not relevant for accounting
70

71. Stock Transfers
• MIGO_TR transactions allow you
to move inventory from one
storage location to another.
• Movements can also be reversed
or cancelled via MIGO_TR.
• This is an Inventory Management
(IM) movement.
71

72. Location to Location Movements (Sloc to Sloc)
72
• You can use MIGO_TRs to remove materials from storage in one
storage location and place them in another storage location if you
do not use a scanner.
• Whether you are using a scanner or entering the movement using
MIGO_TR, the system prints a label with the destination location.
• You should confirm all movements using MMBE.

73. Demo 3.7: Create Stock Transfers (MIGO_TR-311)
You need to move a material from quality to unrestricted stock in your
warehouse
• Transfer Quality approved material from Storage Location QA01 to
Storage Location RM01 with MIGO_TR with Movement type 311.
73

74. Knowledge Check
Name the most common movement type for MIGO_TR.
74

75. Issuing Materials to a Production Order
Materials have to be issued to a production order using
transaction MIGO_GI-261 (Goods Issue to an order).
75

76. Stock Transport Orders (STOs)
Request for materials to be moved from one plant to another plant
• STO is an internal version of a purchase order (PO)
• External vendors do not need to be contacted
– Materials already stored within the enterprise
76

77. Plant to Plant Moves
77
• Use stock transfers to move stock between
Yaskawa plants.
• A stock transfer from plant to plant leads to
a change in stock quantity in both plants.

78. Stage Raw Materials for Production
78
• Use transaction MIGO_GI-261 Goods Issue to issue stock to a
production order.
• This movement takes the inventory out of the plant and makes
the material available for production.

79. Demo 3.8: Issue Material to a Production Order
(MIGO_GI-261)
You need to stage a raw material for production.
• Watch the demo of transaction MIGO_GI-261
79

80. Transfer Postings
• A transfer posting usually refers to a change in a material’s stock (for
example, release from quality inspection stock to unrestricted stock.
• In a transfer posting, the material can remain in its original storage
location or be transferred.
• The following business transactions normally trigger transfer posting
Trigger Description
Stock Type Change Need to change material quantity from one
stock type to another stock type. I.E. from
blocked stock to unrestricted stock.
Material to Material
Change
Need to change material from one material.
number to another material number.
80

81. Transfer Posting Stock Type/Category Change
• You need to perform a stock type change on material from unrestricted
to blocked.
• Results of the Post Change for stock type/category are:
– Creation of material document (movement type 344)
– Stock Update
81

82. Transfer Postings
May --or may not--be connected with a physical goods movement
• Usually involve a change in:
– Stock type
– Material number
• An example of transfer posting:
– Release from inspection into stock
– Change Material number
82

83. Transfer Postings
• Perform MIGO_TR
transaction to move
material from a stock type
of Unrestricted to Blocked.
• Movement type is 344
(Unrestricted to Blocked).
83

84. Exercise 3.9: Create a Transfer Posting from
Unrestricted to Blocked (MIGO_TR-344)
You need to create a transfer posting to change a material from unrestricted
to blocked because it needs to be reviewed.
• Use transaction MIGO_TR-344 to perform the transfer posting.
84

85. Knowledge Check
1.What is the definition of goods movement?
2.What is a logical movement (as opposed to a physical movement)?
85

86. Agenda
• Lesson 1 – Introduction to Inventory Management
• Lesson 2 – Master Data
• Lesson 3 – Inventory Management Processes
• Lesson 4 – Physical Inventory Overview
86

87. Objectives
Upon the completion of this Unit, you should be able to:
• Describe the three methods of performing inventory
87

88. Terms
Term Definition
Physical inventory document Documents created to facilitate capturing
the results of a physical count.
Storage location Area within a plant where materials are
stored.
Physical inventory Quantity of a material that is physically on
hand.
Continuous Inventory An inventory method in the WM system
which can be used any day of the fiscal year.
Keeps book inventory continuously in
agreement with stock on hand within
specified time periods.
Book inventory Inventory seen by the system.
88

89. Terms
Term Definition
Physical inventory status Describes status of the physical inventory
item (counted, adjusted, not yet counted,
and deleted).
Planned count date Date on which the count is scheduled to
begin.
Difference value Inventory difference summarized in a dollar
amount.
Difference quantity Inventory difference quantified in the stock-
keeping unit of the material counted.
89

90. Terms
Term Definition
Posting block Key that indicates no goods movements
involving the materials listed in the physical
inventory document can be posted for the
duration of the physical inventory until the
counts are entered and differences are
accepted and posted.
Freeze book inventory Key that specifies the book inventory
balance of the items not yet counted on the
physical inventory document are frozen.
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91. Physical Inventory Methods
Inventory Methods
Cycle Counting
Continuous inventory
Annual Inventory
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92. Annual Inventory Method
• The stocktaking of all stock in a company
on a fixed date (usually at the end of the
fiscal year)
• Entire storage location is blocked for
movement
• All bins are counted
• Counting performed at bin level
• You must count all material/batch quantities
within the bin
• Customer for this process is the Audit
department
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93. Cycle Count Method
Periodic counting of materials
(period can be decided by policy)
• The stocktaking of all stock in a company on a
fixed date (usually at the end of the fiscal year)
• Entire storage location is blocked for
movement
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94. Cycle Count for Inventory Management
Create system
inventory record
Print Inventory
Document
Enter Count
Print Discrepancy
Report
MI01
MI21
Create Inventory Document MI01
MI04
MI07
Print Document MI21
Save the Cycle Count  MI07
Enter Count MI04
Write off in IM
(Quantity and value update)
MI20 Write off inventory differences  MI20
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95. Continuous Inventory Method
• Can be used any day of the fiscal year
• Keeps book inventory continuously in
agreement with stock on hand within
specified time periods
• Keeps track of actual availability of goods
and determination of what the correct
time to reorder from suppliers
• Sometimes called perpetual inventory
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96. Knowledge Check
1. Which of the following statements are true regarding Continuous
Inventory? (select all that apply)
A. Continuous Inventory is an inventory method in the WM system
B. It can be used any day of the fiscal year
C. It keeps book inventory continuously in agreement with stock on hand within
specified time periods
D. It keeps track of actual availability of goods and determination of what the correct
time to reorder from suppliers
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97. Inventory Management Overview
Having completed this course you should be able to:
 Describe key terms for inventory
management
 Define the receiving, plant, and issuing
processes at the plant
 Understand material movements for IM
locations
 Describe how stock is managed at the
IM level
 Define common movement types
 Describe the results of goods
movements
 Understand the Yaskawa
organizational structure
 Discuss master data elements
 Identify the difference between
master data and transactional
data
 Discuss stock handling tasks
 Understand physical inventory
and cycle counts for IM materials
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98. Questions
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99. Thank you
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