This document discusses materials management in SAP Project Systems (PS). It covers: 1) Integrating PS with Materials Management, Production Planning, and Sales and Distribution for materials. 2) Differentiating between stock and non-stock items and how they are procured. 3) Assigning components directly to projects or activities and defining procurement parameters. 4) Using purchase requisitions for non-stock items or third-party purchase orders to deliver items directly from vendors to customers. 5) Triggering planned orders and purchase requisitions through MRP and converting them to production orders or purchase orders.

1. Enterprise Project Systems – BCO6179
SAP PS - Materials
Presented To: Stephen Paull Presented By:
Neha Bachani - s3835526
Hardik Vasavada - s3835122
Jarrod Fong-Lim - s3640887

2. Agenda
Business Scenario
Materials in Project
Integration with MM and PP
Procurement
Third Party Purchase Orders
Advance Procurement
Delivery

3. SAP PS - Materials
Material: Business Scenario
• We are manufacturing the turbine project in the workshops. The project is
made up of different components. Procure the components required by
purchasing them or producing them in your facilities. Ensure that the turbine is
delivered to your customer.

4. SAP PS - Materials
Sales and
Distribution,
Materials
Management and
Production
Planning and
Control are lined
to projects by
Materials.

5. SAP PS - Materials
• The system
differentiates between
stock (item category
L) and non-stock (item
category N).
•Stock items are
entered for materials
kept in stock
(warehouse, sales
order, or project
stock). Reservations
are generated for
stock items.
• Non-stock items are
entered if materials
are to be procured
directly for the
network (that is, not
using MRP). Purchase
Requisitions are
created for non-stock
items.

6. SAP PS - Materials
The simplest scenario
involves assigning
components directly
to the network or
directly to the activity
on an overview
screen.
The item detail screen
includes the
Procurement
parameters tab that
contains information
on the item category,
the characteristics of
the material, and the
account assignment of
the component.

7. SAP PS - Materials
Selecting the Procurement Type (2) The way in which
components are
procured depends on
Item category: both the item category
1 Stock item/non-stock item and the attributes of
the material.
Material:
Sales order/collective stock, or both
The material master
2 Internal/external procurement, or both stores information on
With or without mixed MRP whether:
• The material is
purchased or
Project definition:
3 With or without project stock manufactured
internally (or both)
• Individual or
4 Sales order: collective
requirements (or
With or without sales order stock
both) are possible
BOM: for the material
5 Special procurement key • The material can be
SAP AG 2003 procured in advance

8. SAP PS - Materials
Non-stock item (N):
• Non-stock items
cannot be managed
as project stock or
sales order stock.
• When the goods
are received, non-
stock items are not
placed into stock,
but posted to the
activity.

9. SAP PS - Materials
If you choose direct
procurement with
item category N,
you can choose
between two
procurement types:
• Purchase
requisition for the
network
• Third-party
requisition for the
network

10. SAP PS - Materials
As soon as you have
activated the
requirements in your
network (for the
entire network, the
individual activity,
or the individual
component), a
purchase requisition
is generated when
you save data.

11. SAP PS - Materials
The main function of MRP is
to ensure material
availability.
The procurement element
for requirements planning is
a planned order and, for
external procurement, a
purchase requisition.
Once quantities and dates
have been planned in
requirements planning,
these planned procurement
elements are converted to
"exact" procurement
elements: For production,
this is the production order
and, for external
procurement, the purchase
order.

12. SAP PS - Materials
The reservation either
takes effect a)
immediately, b) after
release, or c) never.
Case c) is possible as of
Release 4.6.
This enables you to
release the activity but
leave the reservation
inactive for planning.
You can make the
reservation active for
planning at a later
stage.

13. SAP PS - Materials
3rd party purchase orders
allow the purchased material
to be delivered directly from
the vendor to the customer.
When assigning material
components to network
activities the system asks you
to maintain the address of the
customer to which the vendor
is to ship the goods.
You can use addresses from:
• Central address management
• Customer master data
• Purchasing master data

14. SAP PS - Materials
For critical components with
long and unreliable delivery
times to be purchased, these
will be acquired at an early
stage in the project, well
before the project activities
where these components will
be consumed.
Preliminary procurement is
used to this end.
Use preliminary procurement
if you are working with sales
order or project stock.
Category L is selected when
you assign your components to
ensure that stock can be
managed.

15. SAP PS - Materials
The delivery information is
transferred from the superior
object to the subordinate
objects.
If a component has no delivery
information but the upper-level
activity does, this information
is transferred to the
component. If a subordinate
object has delivery
information, then it does not
take the information from the
superior object.
For example: A component and
the upper-level activity have
different delivery information.
Priority is given to the delivery
information that the
component already has.

16. SAP PS - Materials
Select material components to
be delivered to the customer.
This creates an SD delivery
note automatically.
You can select components by
specifying the project
definition, the WBS element, a
sales order, or a network.

17. SAP PS - Materials
Detail screens for each
component display the various
quantities related to the
component (requirement
quantities, item quantities,
quantity in delivery, open
quantities, available open
quantities, for example).
You can deliver materials from
stock, project stock, or sales
order stock. Every item in the
delivery is directly related to
the reservation or purchase
requisition.

18. SAP PS - Materials
After the material is selected,
the delivery note is created
with reference to the network
component.
If a delivery note (document
type LP) is created from a
project, every delivery item
(item category DLP) has a
direct reference to a
reservation or purchase
requisition in the network.
This is used for availability
checks and for updating actual
data for the goods issue.

19. SAP PS - Materials
The system checks the availability of all material components in the network. If
there is a material shortage, the network receives the status material shortage. A
dialog box appears from which you can go directly to the check log, the missing
parts list or missing parts overview.
To check material availability for the network, we have to choose all the activities
from Project Planning Board and go to EditFunctionsMaterial Availability
(Network).

20. SAP PS - Materials
Availability Check Log: Overview about errors in the availability check or information
about material components which are not available.
The log remains available until you leave the transaction. To call up the log, choose
ExtrasLogsMaterial Availabilty.
The log presents an overview of the collected messages. You can display individual
messages by double clicking on them.

21. Thank You
Questions?