Define & Assignment
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SAP Best Practices for SAP MM: Overview of Organizational Structure
Definition
In SAP Material Management (MM), the organizational structure defines how various elements of a business are arranged and interact with each other. It includes the structures and settings that help manage materials, procurement processes, and inventory management efficiently.
Purpose
The purpose of defining and assigning the organizational structure in SAP MM is to ensure that the system aligns with the business processes and requirements. It allows for effective management of procurement, inventory, and logistics operations. By setting up a clear organizational structure, businesses can achieve streamlined operations, accurate reporting, and efficient material management.
Process Flow
- Define Organizational Elements:
- Company Code: Represents an independent accounting entity.
- Plant: A facility where materials are produced or stored.
- Storage Location: A physical location within a plant where materials are stored.
- Purchasing Organization: Responsible for procurement and negotiation with vendors.
- Purchasing Group: A group of buyers responsible for purchasing activities.
- Assignment:
- Company Code to Plant: Assign plants to company codes.
- Plant to Storage Location: Assign storage locations to plants.
- Purchasing Organization to Company Code: Assign purchasing organizations to company codes.
- Purchasing Group to Purchasing Organization: Assign purchasing groups to purchasing organizations.
- Integration:
- Integration with FI (Financial Accounting): Ensure accurate accounting by integrating company codes with purchasing organizations and plants.
- Integration with SD (Sales and Distribution): Sync sales processes with material management through integration with plants and storage locations.
Tables
- T001: Company Codes
- T001W: Plants
- T001L: Storage Locations
- T024: Purchasing Organizations
- T024E: Purchasing Groups
Configuration
- Define Company Code:
- Go to
SPRO > Enterprise Structure > Definition > Financial Accounting > Define Company Code
. - Enter the company code details like company name, address, and other relevant information.
- Go to
- Define Plant:
- Go to
SPRO > Enterprise Structure > Definition > Logistics - General > Define Plant
. - Enter the plant details and assign it to a company code.
- Go to
- Define Storage Location:
- Go to
SPRO > Enterprise Structure > Definition > Logistics - General > Define Storage Location
. - Enter the storage location details and assign it to a plant.
- Go to
- Define Purchasing Organization:
- Go to
SPRO > Enterprise Structure > Definition > Materials Management > Define Purchasing Organization
. - Enter the purchasing organization details and assign it to a company code.
- Go to
- Define Purchasing Group:
- Go to
SPRO > Enterprise Structure > Definition > Materials Management > Define Purchasing Group
. - Enter the purchasing group details and assign it to a purchasing organization.
- Go to
- Assignments:
- Company Code to Plant:
SPRO > Enterprise Structure > Assignment > Logistics - General > Assign Plant to Company Code
. - Plant to Storage Location:
SPRO > Enterprise Structure > Assignment > Logistics - General > Assign Storage Location to Plant
. - Purchasing Organization to Company Code:
SPRO > Enterprise Structure > Assignment > Materials Management > Assign Purchasing Organization to Company Code
. - Purchasing Group to Purchasing Organization:
SPRO > Enterprise Structure > Assignment > Materials Management > Assign Purchasing Group to Purchasing Organization
.
- Company Code to Plant:
Integration
- Integration with FI:
- Ensure that the organizational structure is correctly reflected in the financial accounting settings to enable accurate financial reporting and transactions.
- Integration with SD:
- Ensure that the material management settings are properly aligned with sales processes to facilitate seamless order fulfillment and inventory management.
Testing
- Create and Test Organizational Elements:
- Create test data for company codes, plants, storage locations, purchasing organizations, and purchasing groups.
- Verify that all elements are correctly configured and assigned by running test transactions and ensuring data flows correctly across modules.
- Validation:
- Check integration points between MM and FI/SD by performing end-to-end processes and verifying that data is correctly updated and reported.
- User Acceptance Testing (UAT):
- Conduct UAT to ensure that end-users can navigate the organizational structure and perform their tasks effectively.
- Define Organizational Elements: