SAP Materials Management (MM)

SAP Materials Management Module- SAP MM

The SAP Materials Management – SAP MM module, as the term implies, manages the materials required, processed and produced in businesses. There are different types of procurement processes that are managed through that system. Some of the popular sub-components of the SAP MM module include supplier reference data, consumption-based planning, purchasing, inventory management, invoice verification, etc.

SAP Materials Management – SAP MM

The following are the features of an SAP MM Module:

  • SAP Materials Management Module is one of the SAP modules responsible for material management and inventory management.
  • Materiel management as a process ensures that there is no shortage of materials or deficiencies in the organization’s supply chain process. SAP MM accelerates procurement and materiel management activities, allowing the company to operate smoothly, with full time and cost efficiencies.
  • It focuses on managing an organization’s materials (products and/or services) and resources to accelerate productivity and reduce costs. At the same time, SAP MM is versatile enough to keep up with the changes that are common in any business environment.
  • It covers the procurement process, baseline information (materials and suppliers), account identification and valuation, inventory management, invoice verification, material requirements planning, etc.

SAP MM Sub-Modules.

SAP MM functions include Materiel Management, Supply Process Management, Basic Data Management (Materials and Suppliers), Inventory Management, Materiel Requirements Planning and Invoice Verification.

All these MM sub-modules have functions that execute particular business processes for these modules. These are executed through transactions, the way SAP ECC complements business processes. MM also supports other logistical functions which require material information, such as factory maintenance and project management.

Business Benefits of SAP MM

Everything in SAP MM revolves around basic data, which is stored and handled in centralized basic data tables. Reference data types include reference materials, work center, nomenclature and routing. Baseline data is used to create transaction data in SAP ECC.

For example, when a production order is created in PP, it uses master data from MM about the raw materials needed to produce the finished product, which will subsequently be used to create a sales order in SD

What is SAP Logistics ?

The SAP Materiel Management module is part of SAP Logistics. The role of SAP Logistics encompasses several separate areas which follow with the movement of materials from manufacturer to customer.

Logistics includes purchasing, storing, transporting and delivering goods along the supply chain. Materiel management covers many facets of SAP functionality, including ordering, procuring items, processing products, inventory and invoicing. The primary objective of materials management is to ensure that the supply chain is intact, that there is an adequate level of inventory and less variance between expected and actual outcomes.

SAP MM Objective

The objective of Materials Management is to provide clients with an uninterrupted production line of components to deliver products on time. The Materials Department is paid to hand over the goods to a supply base, ensuring that the goods are shipped to customers on time using the appropriate carrier.

SAP Materiel Management simplifies procurement process, materiel assessment and accounting, invoice verification, inventory management, material requirements planning, baseline data (equipment and vendor reference files), etc.

Materials management is often responsible in some industries for acquiring materials through the establishment and management of a supply base. In other organizations, a separate purchasing service is responsible for sourcing and managing the supply base. Procurement is then responsible for variations in purchase prices fro the sourcing base.

Sub-Components of SAP MM

SAP S/4 HANA Material Management (MM) is one of the most important modules within SAP. The SAP MM module has many sub-components, the most important of which are:

  • Master data
  • Purchasing
  • Inventory management
  • Invoicing verification
  • Physical inventory
  • Material valuation
  • Service management

Among the baseline data for the above-noted sub-components, purchasing and inventory management is the most prevalent in the Materials Management module.