This document discusses SAP Quality Management (QM) and how to integrate it with production planning processes. It covers what QM is, how it differs based on discrete, repetitive, or process industry manufacturing strategies, and the main differences between QM during versus after production. It also outlines key customization tasks and master data requirements to integrate QM with production planning, and demonstrates processing a production order with and without QM. The document provides an overview of SAP QM functionality and its integration points with production planning.

1. SAP Quality Management (QM):
When to Leverage It, How to Set
It Up, and How to Integrate It
with Your Current Production
Planning Processes
Isaac Mazliach
S.D.M. Israel
© 2007 Wellesley Information Services. All rights reserved.

2. What This Session Will Cover, and Why!
• Due to regulations put forth by the Food & Drug
Administration (FDA), the Federal Aviation Association
(FAA), Sarbanes-Oxley (SOX), and others, SAP
customers are compelled to use the Quality Management
(QM) component more than ever
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3. What This Session Will Cover, and Why! (cont.)
• QM is increasingly viewed as a business advantage (as with
Motorola Six Sigma plan Statistical Process Control [SPC])
• This session will introduce the Quality Management component
(QM), and describe its main uses relevant to SAP Production
Planning (PP) processes
3

4. What We’ll Cover …
• What is QM?
• How different manufacturing strategies — discrete,
repetitive, and Process Industry (PP-PI) — change the
ways to integrate QM
• What are the differences between QM during production
and QM at the end of production?
• Main customizing tasks to integrate QM with PP
• Master data requirements to integrate QM with PP
• Demo: Process order with and without QM
• Wrap-up
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5. A Definition of QM
• Quality Management (QM) is a component of mySAP PLM
used to plan, check, verify, and document the quality of
products and processes
• Three main requirements for a QM system:
 Total Quality Management (TQM)
 Industry-specific standards: FDA and Good Manufacturing
Practice (GMP)
 Standards for QM systems (ISO 9000)
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6. Evolution of QM
• Let’s see a brief look at the history of software
development in the quality management area
 SAP R/3 – QM: Planned and event-controlled processes in
quality management for purchasing and production, with little
functionality (compared to today’s)
 mySAP PLM – QM: Functional area of mySAP PLM,
encompassing quality engineering, quality improvement, and
quality assurance and control
 mySAP ERP – QM: All QM-relevant processes (quality planning,
quality inspection, quality certificate, quality notification,
quality control, test equipment management, stability study)
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7. What Does QM Include?
• Quality Management is integrated in the SAP system and
uses basic and cross-application functions, such as:
 Document Management System (DMS)
 Engineering Change Management (ECM)
 Classification System
 Audit Management
 Workflow
 ArchiveLink
 SAPoffice
 Example: QM documents may be managed with DMS
(txn CC04) and/or SAPoffice (txn SBWP)
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8. Functions of the Quality Management Area
• Quality planning – create and manage the master data
that is required to plan and execute quality inspections
• Quality inspection – identify whether the inspected units
fulfill the predefined quality requirements
• Quality certificate – certify the quality of a material
(contains texts, specification values, and
inspection results)
• Quality notification – record and process internal and
external problems that are primarily caused by
poor-quality goods or services
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9. Functions of the Quality Management Area (cont.)
• Quality control – implement various preventive,
monitoring, and corrective activities
 Specifications from quality planning and evaluations from
quality inspections and quality notifications, form the basis for
quality control
• Test equipment management – manage master data,
as well as plan and process calibration inspections
for test equipment
• Stability study – manage basic data, as well as the
planning and execution of stability studies
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10. Quality Management (QM) in Production Planning (PP)
• QM in PP covers the following areas:
 Integrating inspection planning/production operations
 Inspection operations can be directly included in routines
(discrete manufacturing and repetitive manufacturing) or
Master Recipes (process industry)
 Controlling inspections during production
 Inspection lot origin 03 (during production)
 Inspection lot origin 04 (Goods Receipt [GR]
from production)
 Statistical Process Control (SPC)
 For example, control chart with mean value and standard
deviation for an inspection characteristic
 Processing internal problem notifications – notification type Q3
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11. What We’ll Cover …
• What is QM?
• How different manufacturing strategies — discrete,
repetitive, and Process Industry (PP-PI) — change the
ways to integrate QM
• What are the differences between QM during production
and QM at the end of production?
• Main customizing tasks to integrate QM with PP
• Master data requirements to integrate QM with PP
• Demo: Process order with and without QM
• Wrap-up
11

12. Discrete Manufacturing
• These are the “normal” • As soon as a planned
production orders order is generated from
 Each material is produced Materials Requirement
individually (i.e., an individual Planning (MRP), shop
production order for each floor takes over the
production lot) information available and
• The work processes within adds the order-relevant
a company are executed data to it to guarantee
using production orders complete order
• A production order defines which processing
material is to be processed, at • Production orders are
which location, at which time,
and requiring how much work used to control production
 It also defines which resources within a company, and
are to be used and how the also to control cost
order costs are to be settled accounting
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13. Repetitive Manufacturing
• A component in the SAP • Implement repetitive
system for planning and manufacturing if the
controlling repetitive following is true of your
manufacturing and production process:
 You produce the same or similar
flow manufacturing products over a lengthy period
of time
• It enables the period-  You do not manufacture in
individually defined lots. Instead,
dependent and quantity- a total quantity is produced over
dependent planning of a certain period at a certain rate
per part-period.
production lines, reduces the  Your products always follow the
work involved in production same sequence through the
machines and work centers
control, and simplifies in production
backflushing (confirmation,  Routings tend to be simple and
do not vary much
Goods Receipt posting)
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14. Process Industry Manufacturing (PP-PI)
• With PP-PI, SAP provides an • PP-PI uses terms such as:
integrated planning tool for  Master Recipes – the processes
to be used for producing
batch-oriented process materials in your plant, as well as
manufacturing the resources and ingredients
required for production
• It is primarily designed for the
 Process Orders – copy a
chemical, pharmaceutical, process described in a Master
food, and beverage industries, Recipe and adjust it to the
actual production run
as well as the batch-oriented  Process Management –
electronics industries coordinate the communication
between PP-PI and the process
control during the execution of a
process order
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15. QM Changes According to Production Method
• QM uses different blocks (customizing, master data, etc.)
according to the production method (discrete, process,
and repetitive). Here are some examples:
 When process order is used – inspection planning may reside
in the Master Recipe
 When production order is used – inspection planning may
reside in the routine (txn CA03)
 When PP-PI is used – inspection results shall be recorded in the
PI sheet (txn CO60)
 When discrete or repetitive is used – inspection results shall be
recorded in the inspection lot (txn QE51N)
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16. What We’ll Cover …
• What is QM?
• How different manufacturing strategies — discrete,
repetitive, and Process Industry (PP-PI) — change the
ways to integrate QM
• What are the differences between QM during production
and QM at the end of production?
• Main customizing tasks to integrate QM with PP
• Master data requirements to integrate QM with PP
• Demo: Process order with and without QM
• Wrap-up
16

17. Production Chain
Inspection
Production Order Order Goods
during
Planning release production
confirmation movement
• Sample • Operations + • Recording • GR in
calculation inspection of scrap warehouse
characteristics
• Inspection • Partial lot • Batch proposal
lot creation • Inspection points creation
• Batch
• Approval • Measured • Valuation classification
procedure value and
defects • Batch • Release of
recording classification batch record
• SPC control
chart
• Externally
processed
operations
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18. QM During Production
• Inspection lot origin = 03
• Inspection lot is created at the PP order release
• At Goods Receipt, material immediately entered into
unrestricted-use stock
• Control is less strict
 Materials with “bad” inspection may enter the “good” stock
• If better control is required, production reporting should
be on the operation level
 In this case, it should be forbidden to move to the next
operation if the previous one was not accepted
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19. QM at the End of Production
• Inspection lot origin = 04
• Inspection lot is created at Goods Receipt
• At Goods Received, the produced material is received
into QI-Stock
 Only usage-decision may move it to unrestricted-use stock
• Control is more strict
 If material did not pass inspection, it cannot be used
• Production reporting may be on operation level or on
order level
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20. What We’ll Cover …
• What is QM?
• How different manufacturing strategies — discrete,
repetitive, and Process Industry (PP-PI) — change the
ways to integrate QM
• What are the differences between QM during production
and QM at the end of production?
• Main customizing tasks to integrate QM with PP
• Master data requirements to integrate QM with PP
• Demo: Process order with and without QM
• Wrap-up
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21. Customization Tasks to Integrate QM with PP
• Separate transaction for QM customization: QCC0
• Quality planning
 Inspection characteristics, inspection methods
 Sample determination
 Define task list types, usage, and status
 Define control key for inspection operations
 The required Task List Usages can be created
in customizing
 The Task List Usage is entered in the headers of the
task lists and in customizing of the inspection types
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22. Assign Task List Type to Material Types
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23. Quality Inspection
• Inspection types
• Inspection for goods movements
• Assign inspection type for manufacturing order
(per production order type or process order type)
• Maintain usage decision for catalog type = 3
• Define physical sample type, container, and locations
Important:
 The meaning of the catalogs 0 to 9 Z and A to O
is defined by SAP
 The other catalogs (P to Z) can be defined by
the customer
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24. Define Control Keys for Inspection Operations
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25. Quality Certificates
• Certificate profile
• Maintain form
• Output determination
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26. Quality Notifications
• Notification types and content
• Additional notification functions (action box and
follow-up actions)
Q: What are Quality Notifications?
A: Quality Notifications are the central medium in
QM for processing problems and unplanned
events
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27. Quality Control
• In Materials Management (MM): Vendor evaluation
• In Logistics Information System (LIS): Quality
Management Information System (QMIS)
• In QM: Definition and evaluation of original documents
Control Chart: Form for the graphical display of characteristics values that
occur during an inspection. The control chart compares the displayed
values with the action limits and, in this way, supports the quality-related
control of the process.
The run-chart is a graphical display of the single values of a quantitative
characteristic in a run time. You cannot valuate inspection results using the
run-chart.
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28. Stability Study
• Define physical sample types
• Define testing schedule category
• Notification types
• Catalogs
• Inspection types
Stability Studies are performed in the chemical,
pharmaceutical, and food industries to examine how
different conditions affect a product over a specified
period of time
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29. What We’ll Cover …
• What is QM?
• How different manufacturing strategies — discrete,
repetitive, and Process Industry (PP-PI) — change the
ways to integrate QM
• What are the differences between QM during production
and QM at the end of production?
• Main customizing tasks to integrate QM with PP
• Master data requirements to integrate QM with PP
• Demo: Process order with and without QM
• Wrap-up
29

30. Quality Planning as a Foundation for Master Data
• In quality planning, you define information and
processes on a long-term basis as Master Records
• Quality planning provides the basis for inspection
processing
• To do that, quality planning uses cross-application data,
such as:
 Material Master
 Batch classification
 Quality documents
 Work center
 Serial numbers
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31. Master Data: Material Master QM View
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32. Master Data: Routine View
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33. Master Data: Routine View (cont.)
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34. Quality Planning as Part of QM
• Quality planning uses QM-specific basic data such as:
 Master inspection characteristics
 Inspection methods
 Sampling procedures
 QM work center (with its capacity)
 Catalog
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35. Quality Planning and Inspection Planning Data
• Quality planning uses inspection planning data such as:
 Inspection plans
 PP-PI: Master Recipe, Resource
 Routing
 Material specifications
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36. What We’ll Cover …
• What is QM?
• How different manufacturing strategies — discrete,
repetitive, and Process Industry (PP-PI) — change the
ways to integrate QM
• What are the differences between QM during production
and QM at the end of production?
• Main customizing tasks to integrate QM with PP
• Master data requirements to integrate QM with PP
• Demo: Process order with and without QM
• Wrap-up
36

37. Process Order Without QM
• When production is complete, enter a Goods Receipt of
the material into stock
• The Transaction is CO60 – maintain PI sheet
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38. DEMO – Process Order Without QM
No QM data!
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39. Process Order with QM
• When production is complete, enter the following:
 Inspection results (through characteristics)
 Usage decision
 Only then, enter Goods Receipt of the material into stock
• The transactions:
 CO60 – maintain PI sheet
 QE51N – find inspection lot per material
 QA11 – enter usage decision
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40. DEMO – Process Order with QM
Enter QM
data here!
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41. DEMO – Process Order with QM (cont.)
41

42. DEMO – Process Order with QM (cont.)
42

43. DEMO – Process Order with QM (cont.)
43

44. What We’ll Cover …
• What is QM?
• How different manufacturing strategies — discrete,
repetitive, and Process Industry (PP-PI) — change the
ways to integrate QM
• What are the differences between QM during production
and QM at the end of production?
• Main customizing tasks to integrate QM with PP
• Master data requirements to integrate QM with PP
• Demo: Process order with and without QM
• Wrap-up
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45. Resources
• Product information:
 www.sap.com/plm
• Product documentation:
 http://help.sap.com
• For customers and partners:
 http://service.sap.com/qm *
• Information about courses:
 www.sap.com/education
*Requires login credentials to the SAP Service Marketplace
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46. 7 Key Points to Take Home
• QM became crucial in recent years
 Now, more than ever, it is important to implement it in PP
• Before starting the QM project, make sure your
implementation complies to the rules and regulations
of your company’s business (SOX, FDA, etc.)
• To allow the QM process to work, allocate the necessary
resources to ensure that master data is correct
• If a more strict control is required, you may consider
inspecting the material at the end of production
 If the production process is long or divided into many
processes, you may consider inspecting during production, also
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47. 7 Key Points to Take Home (cont.)
• Focus on the main customizing and master data tasks
 Do not try to achieve everything right at the beginning
• Use notification wisely. It is very powerful.
• Make sure you allow production to continue working
after QM implementation
 Do not sacrifice production on the altar of QM
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48. Your Turn!
How to contact me:
Isaac Mazliach
ISAAC@SDM-C.COM
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