EGN 5620 Enterprise Systems Configuration
(Professional MSEM)
Fall, 2012

EGN 5620 Enterprise Systems Configuration
(Professional MSEM)
Fall, 2012

FI MM PP SD
FI
MM
PP
SD
January 2008
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The Rushmore Group, LLC 2007. All rights reserved.
4

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Unlike master data, transactional data is dynamic - it constantly changes, usually many times per day
Transactions data include
◦ organizational structure,
◦ master data,
◦ rules, as well as
◦ business activities
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(Make-to-Stock)
Production order creation
( Capacity Planning )
Production
Order Request
Production Order Release
Order
Settlement
Goods
Receipt
Goods
Issue
Confirmation of
Production Order
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Completion
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• Regardless of the source of the trigger, the outcome of this step is a planned order.
• Planned order is a formal request for production.
• Planned order is a transaction document.
• In a planned order, the following information is defined:
• What products are needed
• How many units of the products are needed
• When they are needed
• In this step, no FI or CO documents are created, so there is no financial impact.
• There is no movement of materials.
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Production Request (Planned Order Header)
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Production Request
- Planned Order (Components review)
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Production Order
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A production order is typically created by converting a planned order, but it can also be generated directly without using a planned order.
Planned orders can be converted individually, collectively, or partially.
A production order includes reference to PP master data, such as a BOM, routing, and work centers.
◦ BOM identifies materials to be used in production.
◦ Routing identifies operations needed for the order.
◦ Work centers are the working locations where operations are to be performed and work centers define the capacity requirement for the order.
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
While creating a production order, the following actions are carried out:
 Select a routing: operations and sequences.
 Transfer the bill of materials from database for master data.
 Reserve items in stock, according to the bill of materials
 Generate the planned costs
 Generate the capacity requirements for the work centers
 Generate purchase requisitions for non-stock items and externally-processed operations
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Production Order (structure)
Production Order Structure
•
•
•
•
•
•
•
•
•
Header
Operations
Capacity
Components
Costs
Scheduling
Settlement Rules
Document Link
Confirmation
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Production Order (data elements)
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Order header
◦ Order number
◦ Material to be produced
◦ Plant
◦ Quantity
◦ Scheduler (Dates)
◦ Status
PRT (Production
Resource Tool)
◦ Tooling
◦ Equipment
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Operations
◦ Tasks
◦ Work centers
◦ Times, Dates
◦ Standard value
◦ Control keys
Components
◦ Material components
◦ Quantity
◦ Required date
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How (Routing)
Components (BOM)
What (Finished good)
How many
Time Line

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Production Order - (Components)
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Production Order (Master Data)
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Production Order– Preliminary Cost
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A production order includes preliminary estimates for various cost components, such as material and overhead.
Material costs are based on the costs of the components assigned to the production order.
These costs are maintained in master data of each component.
Production costs are based on data in work center, such as activity types and formulas that identify which activities (e. g. lab and setup) are required and in what quantity.

Production Order– Preliminary Cost
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The costs are associated with appropriate accounts in general ledger, such as material consumption accounts.
As production is executed, actual costs are assigned in the production order along with the preliminary cost estimates.
After a production order has been completed, the cost accumulated in the production order must be settled.
During settlement, the actual costs incurred are allocated to cost objects based on specified settlement rules.

Production Order (Preliminary Cost)
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SAP calculates the production dates and capacity requirements for all operations within an order
Scheduling function uses data from production order (quantity and dates) and work centers.
◦ Determines a Routing
 Operation specific time lines
 Material Consumption Points
◦ Links to Material Master
 Scheduling Margin Key (Floats)
◦ Links to Work Center
 Formulas
 Standard Inter-operation Times

Production Order (Scheduling)
Work Center Formulas
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January 2008
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Production Order (Settlement Rules)
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Production Order (Document Link )
•
•
•
•
A production order may contain reference to various documents.
A BOM for example, may include a document item.
Production order often includes links to documents in the document management system (DMS).
DMS is used to ensure the most current version of documents is employed during production.

Production Order (Availability Check)
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Automatic check to determine whether the components, production resources tools, and capacities in an order are available
◦ It can be automatic or manually executed
◦ It determines availability on the required date
◦ Unlike scheduling, availability checks are not repeated automatically if the production order is changed.
It generates an availability log which displays:
◦ Results of the check
◦ Missing parts list
◦ Reservations that could not be verified

Production Order Release
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The time between scheduling and releasing an order is used for preparation needed for the processing of the order
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Once an order is released, it is ready for execution. At this time, the user can:
◦ print shop floor documents
◦ execute goods movements
◦ accept confirmations against the order

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Goods Issue for production Order
Note:
◦ That when a production order is being created, it references a BOM that determines the necessary components to produce the goods, it also places a reservation on each of the components
Upon release of the order (or operation) the reserved materials can be issued from inventory; and the system (SAP):
◦ Updates the reservation
◦ Updates the inventory
◦ Assigns costs to the order as actual costs

Goods Issue for production Order
Effects of the Goods Issue

◦ updates stock quantity
◦ updates stock value
◦ Updates production order status
Three documents are created:
◦ material document
◦ accounting document
◦ controlling document

Goods Issue for Production Order
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Good Issue for Production Order
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Confirmation of Production Order
Completion
Confirmations are used to monitor and track the progression of an order through its production cycle

◦ confirmation can be done at the operation or order level
Exact confirmation shortly after completion of an operation is essential for realistic production planning and control

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Confirmation of Production Order
Completion
Completion confirmation
◦ Quantities of material used
◦ Operations completed
◦ Time
◦ Personnel
Costs
◦ Planned costs and actual costs

Settlement rule for the order for accounts/cost centers
◦ Settlement profile
 Settlement receiver
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Confirmation of Production Order
Completion

Completion confirmation:
 Confirms both the yield and scrap quantities
 Can do product receipt if automatic Goods
Receipt (G/R) set
 Generates labor cost based on activity costs
January 2008
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Confirmation of Production Order
Completion (Cost updated)
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Planned costs
◦ Primary Costs
 Material Costs (BOM)
◦ Based on material master price for each component
◦ Updated when goods are issued to order, or when purchased materials are received
 Cost for External Processing
◦ Secondary Cost
 Production Costs (Routing)
◦ Time cards from operations
 Material Overhead Costs
 Production Overhead Costs
Gets updated at completion confirmation
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The Rushmore Group, LLC 2007. All rights reserved.
January 2008 36

Confirmation of Production Order
Completion

Confirmation of Production Order
Completion (Labor cost is added)

Goods Receipt for Production Order

Acceptance of the confirmed quantity of output from the production order into stock
◦ Effects of the Goods Receipt
 update stock quantity
 update stock value
 update production order (status)
 store price for future valuation changes
◦ Three documents are created
 material document
 accounting document
 controlling document

Goods Receipt for Production Order

Goods Receipt for Production Order
(Cost Target/Actual Comparison)


Settlement Rule
◦ Automatically assigned to order according to settlement rules defined in production order
◦ Distribution rule (cost receiver, settlement share and type)
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Production Order Settlement
(Production Order Status)
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REL:
CRTD:
PRT:
PCNF:
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CNF:
PDLV:
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DLV:
PRC:
Released
Created
Printed
Partially
Confirmed
Confirmed
Partially
Confirmed
Delivered
Pre-costed
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GMPS:
MACM:
MANC:
NTUP:
SETC:
Goods movement posted
Material Committed
Mat. Availability not checked
Dates are not updated
Settlement rule created
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
Settling a Production Order to Stock
◦ postings are made to the materials & labor and production order accounts with the value of the material and labor and received finished goods.
◦ difference between the debt posting and credit posting is posted to a price difference account
**Material Price determined by the quantity produced times the Standard Price in the Material
Master.

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Costs analyzed
◦ Primary
 Materials
 External Processing
◦ Secondary
 Production, Administrative Overhead, and
 Labor
Cost Analysis Reporting
 Calculate and analyze planned costs, target costs, and actual costs of the production order.
 Calculate and analyze variances

EGN 5620 Enterprise Systems Configuration
(Professional MSEM)
Fall, 2012

Actual Material Cost Line Items for Order

Actual Labor Cost Line Items for Order

Good Issue Material Document for Order

Confirmation Document for Order

Goods Receipt Material Document for
Order

Exercises:
259. Create purchase order
260. Create goods receipt
262. Post invoice receipt from vendor
263. Display vendors invoice (gross) document
264. Post payment to vendor
276. Create a production plan
277. Display stock/requirements list
278. Transfer planning data to demand management
279. Review demand management
280. Display stock/requirements list
281. Run master production schedule
282. Display stock/requirement list
283. Convert planned order to production order
284. Issue goods to production order
285. Confirm production completion

Exercises:
286. Receipt of goods from production order
287. Settle costs of production order
287A. Display stock/requirements list