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SAP S/4HANA MM Practice Guide

SAP S/4HANA MM Practice Guide

Comprehensive scenarios to master Materials Management in S/4HANA

Overview
Master Data
Procurement
Inventory
Special Proc.
Reporting

Company Structure Overview

Before starting your practice scenarios, familiarize yourself with the organizational structure that will be used throughout this guide.

Global Enterprise Structure

Organization Setup 
Client: 100 (Global Enterprise Inc.)

Company Codes:
1000 - Global HQ (Los Angeles, USA)
2000 - European Operations (Berlin, Germany)
3000 - Asia Pacific Division (Singapore)

Plants:
LA01 - Los Angeles Main Plant (Company Code 1000)
LA02 - Los Angeles Distribution Center (Company Code 1000)
NY01 - New York Distribution Center (Company Code 1000)
BE01 - Berlin Manufacturing Plant (Company Code 2000)
BE02 - Berlin Distribution Center (Company Code 2000)
SG01 - Singapore Distribution Center (Company Code 3000)

Storage Locations:
0001 - Raw Materials
0002 - Finished Goods
0003 - Spare Parts
0004 - Consignment
0005 - Quality Inspection

Purchasing Organization Structure

Purchasing Organizations:
G100 - Global Purchasing (Enterprise-wide)
US10 - US Purchasing (North America)
EU10 - European Purchasing
AP10 - Asia Pacific Purchasing

Purchasing Groups:
T01 - MRO & Office Supplies
T02 - Raw Materials
T03 - Capital Equipment
T04 - Services
T05 - Trading Goods

Master Data

Key Vendors:
1000 - Office Supplies Inc. (Domestic US)
2000 - China Tea Company (International)
2001 - India Tea Exports (International)
3000 - TechCom Electronics (Electronics Supplier)
4000 - PharmaSynth Inc. (Pharmaceutical Ingredients)
5000 - TechSolutions Consulting (IT Services)
6000 - OfficeSupply Global (Global Supplier)

Material Categories:
RM-* - Raw Materials
FG-* - Finished Goods
TE-* - Trading Goods (Tea Products)
ST-* - Stationery & Office Supplies
COMP-* - Components
SRV-* - Services
EQUIP-* - Equipment

SAP S/4HANA MM Consultant Roadmap

As an MM consultant in S/4HANA, you need to master various processes and scenarios. This guide will help you practice all essential MM functions step-by-step.

1 Master Data Management

Master data is the foundation of all MM processes. Practice creating and managing:

  • Material Master Records
  • Vendor Master Records
  • Info Records
  • Source Lists
  • Quota Arrangements

Pro Tip

Create templates for different material types to speed up future creation processes.

2 Procurement Process

The core of MM is the procurement cycle. Practice the full P2P process:

  • Purchase Requisition
  • RFQ and Quotations
  • Purchase Orders
  • Goods Receipt
  • Invoice Verification

Pro Tip

Understand approval workflows and practice different purchasing scenarios.

3 Inventory Management

Effective inventory control is crucial. Practice:

  • Goods Movements (MIGO)
  • Physical Inventory
  • Reservation Management
  • Stock Transfers

Pro Tip

Learn special stock indicators and practice different valuation scenarios.

4 Special Procurement Types

Master specialized procurement methods:

  • Consignment
  • Subcontracting
  • Pipeline Management
  • Stock Transport Orders

Pro Tip

Understand the accounting impacts of each special procurement type.

Key S/4HANA MM Innovations

S/4HANA introduces several innovations over traditional SAP ECC:

S/4HANA eliminates redundant tables and aggregate tables. Key changes include:

  • MATDOC replaces MKPF and MSEG
  • Material Ledger is mandatory
  • Single source of truth with real-time analytics

SAP Fiori provides a modern, role-based user experience with apps like:

  • Manage Purchase Orders
  • Manage Material Master
  • Monitor Material Documents
  • Track Purchase Orders

Real-time analytics capabilities include:

  • Smart Business Cockpits
  • Procurement Spend Analysis
  • Inventory KPIs
  • Vendor Evaluation

Master Data Management Practice Scenarios

Master data is the foundation of all MM processes. Practice these scenarios to build proficiency.

Scenario 1: Material Master Creation

Master Data Basic

Create different types of materials with appropriate views based on their usage.

Practice Steps:

  1. Create a Raw Material (Transaction: MM01)
    • Fill Basic Data
    • Complete Purchasing Data
    • Set up MRP Data
    • Configure Accounting Data
  2. Create a Finished Product
    • Include Sales Views
    • Configure Production Views
  3. Create a Trading Good
  4. Create a Service Material
  5. Practice extending materials to different plants (MM02)

Configuration Tips

Pay attention to material type, industry sector, and material group as they determine which views are relevant. Practice using material templates to speed up creation.

Scenario 2: Vendor Master Management

Master Data Basic

Create and manage vendor records with complete purchasing and accounting data.

Practice Steps:

  1. Create a Domestic Vendor (Transaction: XK01)
    • Fill General Data
    • Configure Purchasing Data
    • Set up Accounting Information
    • Define Payment Terms
  2. Create an International Vendor
    • Set up Foreign Currency Handling
    • Configure Tax Information
  3. Create a One-Time Vendor
  4. Practice extending vendors to different company codes (XK02)

Configuration Tips

Understand vendor account groups and their impact on fields. Practice setting different payment terms and methods.

Scenario 3: Source of Supply Setup

Master Data Intermediate

Configure various sources of supply to manage procurement sources.

Practice Steps:

  1. Create Info Records (Transaction: ME11)
    • Set Material-Vendor Relationships
    • Define Pricing Conditions
    • Set Validity Periods
  2. Create Source Lists (Transaction: ME01)
    • Add Multiple Vendors
    • Set Validity Periods
  3. Create Quota Arrangements (Transaction: MEQ1)
    • Distribute Percentages Among Vendors
    • Set Validity Periods
  4. Practice updating and displaying these records (ME12, ME13, ME02, ME03, etc.)

Configuration Tips

Understand how source lists, info records, and quota arrangements interact with the procurement process. Practice scenario where these sources of supply influence automatic vendor determination.

Procurement Process Practice Scenarios

The procurement process is central to Materials Management. Practice these end-to-end scenarios.

Scenario 1: Standard Procurement Cycle

Procurement Basic

Execute a complete Procure-to-Pay cycle with all standard steps.

Practice Steps:

  1. Create Purchase Requisition (Transaction: ME51N)
    • Create for Stock Material
    • Add Account Assignment Category
  2. Convert to Request for Quotation (Transaction: ME41)
    • Send to Multiple Vendors
  3. Enter Vendor Quotations (Transaction: ME47)
  4. Price Comparison (Transaction: ME49)
  5. Create Purchase Order (Transaction: ME21N)
  6. Process Goods Receipt (Transaction: MIGO)
  7. Process Invoice Receipt (Transaction: MIRO)
  8. Check Documents Flow (Transaction: ME23N)

Configuration Tips

Focus on document flow and understanding how each document is related. Practice approval workflows if available in your system.

Scenario 2: Direct Purchase Orders

Procurement Basic

Create purchase orders directly without purchase requisitions.

Practice Steps:

  1. Create Standard PO (Transaction: ME21N)
    • For Stock Materials
    • With Account Assignment
  2. Create PO with Reference to Info Record
  3. Create PO with Manual Price Determination
  4. Process Goods Receipt (Transaction: MIGO)
  5. Process Invoice Receipt (Transaction: MIRO)

Configuration Tips

Practice different account assignment categories (Cost Center, Project, etc.) and understand how they impact accounting.

Scenario 3: Framework Agreements

Procurement Intermediate

Create and process contract and scheduling agreements.

Practice Steps:

  1. Create Contract (Transaction: ME31K)
    • Value Contract
    • Quantity Contract
  2. Create Purchase Orders with Reference to Contract
  3. Create Scheduling Agreement (Transaction: ME31L)
  4. Create Delivery Schedules
  5. Process Goods Receipts against these Agreements
  6. Monitor Release Orders
  7. Check Contract Consumption

Configuration Tips

Understand the differences between contracts and scheduling agreements. Practice creating different types of releases and monitoring consumption.

Scenario 4: Invoice Verification Scenarios

Procurement Intermediate

Practice various invoice verification scenarios including exceptions.

Practice Steps:

  1. Standard Invoice Verification (Transaction: MIRO)
    • With Reference to PO
    • With Goods Receipt
  2. Invoice with Price Variances
  3. Invoice with Quantity Variances
  4. Credit Memo Processing
  5. Subsequent Debit/Credit
  6. Blocked Invoice Handling
  7. Park and Post Invoices

Configuration Tips

Understand tolerance limits and their impact on invoice blocking. Practice resolving blocked invoices and understand the integration with FI.

Inventory Management Practice Scenarios

Effective inventory control is crucial for MM processes. Master these scenarios.

Scenario 1: Goods Movements

Inventory Basic

Practice various types of goods movements using MIGO transaction.

Practice Steps:

  1. Goods Receipt for Purchase Order (Movement Type 101)
  2. Goods Issue to Cost Center (Movement Type 201)
  3. Transfer Posting between Storage Locations (Movement Type 311)
  4. Transfer Posting between Plants (Movement Type 301)
  5. Stock Transfer with Delivery (Movement Type 351/641)
  6. Goods Receipt without Reference (Movement Type 501)
  7. Goods Issue without Reference (Movement Type 601)

Configuration Tips

Understand the impact of different movement types on inventory and accounting. Practice using different storage locations and batch management.

Scenario 2: Physical Inventory

Inventory Intermediate

Execute the complete physical inventory process.

Practice Steps:

  1. Create Physical Inventory Document (Transaction: MI01)
    • For Storage Location
    • For Material
    • For Special Stock
  2. Print Count Sheets (Transaction: MI21)
  3. Enter Inventory Count (Transaction: MI04)
  4. Post Differences (Transaction: MI07)
  5. Display Physical Inventory Document (Transaction: MI03)
  6. Review Inventory Difference List

Configuration Tips

Understand the differences between periodic and continuous inventory. Practice both freeze and non-freeze inventory methods.

Scenario 3: Reservations Management

Inventory Basic

Create and manage reservations for different requirements.

Practice Steps:

  1. Create Reservation for Cost Center (Transaction: MB21)
    • For Single Material
    • For Multiple Materials
  2. Create Reservation for Project (Transaction: MB21)
  3. Display Reservations (Transaction: MB23)
  4. Change Reservations (Transaction: MB22)
  5. Goods Issue against Reservation (Transaction: MIGO)

Configuration Tips

Understand how reservations affect available stock calculation. Practice with different account assignments.

Scenario 4: Material Valuation

Inventory Advanced

Practice different material valuation methods and price changes.

Practice Steps:

  1. Configure Moving Average Price Materials
  2. Configure Standard Price Materials
  3. Perform Price Changes (Transaction: MR21)
  4. Revaluation of Material Stock (Transaction: MR21)
  5. Analyze Material Valuation Reports (Transaction: MM60)
  6. Review Material Price Analysis (Transaction: CKM3)

Configuration Tips

Understand the Material Ledger in S/4HANA. Practice with multiple currencies and price determination.

Special Procurement Scenarios

Master these advanced procurement scenarios to round out your MM expertise.

Scenario 1: Consignment Process

Special Proc. Advanced

Implement and manage the full consignment procurement process.

Practice Steps:

  1. Create Consignment Info Record (Transaction: ME11)
    • With Special Stock Indicator K
  2. Create Consignment Purchase Order (Transaction: ME21N)
  3. Goods Receipt for Consignment (Transaction: MIGO)
  4. Consignment Issue to Consumption (Transaction: MIGO)
  5. Consignment Settlement (Transaction: MR11)
  6. Return Consignment Stock to Vendor (MIGO)

Configuration Tips

Understand how consignment stock is valued and settled. Practice with different settlement periods and settlement variations.

Scenario 2: Subcontracting Process

Special Proc. Advanced

Execute the full subcontracting process with component tracking.

Practice Steps:

  1. Create BOM for Subcontracting
  2. Create Subcontracting Info Record (Transaction: ME11)
  3. Create Subcontracting Purchase Order (Transaction: ME21N)
  4. Issue Components to Vendor (Transaction: MIGO)
  5. Receive Finished Product from Subcontractor (Transaction: MIGO)
  6. Process Subcontracting Invoice (Transaction: MIRO)

Configuration Tips

Understand how to track components provided to vendors. Practice with different subcontracting scenarios and component provisioning methods.

Scenario 3: Pipeline Management

Special Proc. Advanced

Implement and manage pipeline materials procurement.

Practice Steps:

  1. Configure Material for Pipeline Handling
  2. Create Info Records for Pipeline Material
  3. Create Pipeline Purchase Order
  4. Record Pipeline Withdrawals
  5. Process Pipeline Settlement

Configuration Tips

Understand the specifics of pipeline materials like gas, oil, or chemicals. Practice with different measurement and settlement methods.

Scenario 4: Stock Transport Order

Special Proc. Intermediate

Manage inter-plant stock transfers with delivery processing.

Practice Steps:

  1. Create Stock Transport Order (Transaction: ME21N)
    • With Item Category U (Stock Transport)
  2. Create Outbound Delivery for STO (Transaction: VL01N)
  3. Post Goods Issue for Outbound Delivery
  4. Receive Stock at Receiving Plant (Transaction: MIGO)
  5. Practice Two-Step and Single-Step STO procedures

Configuration Tips

Understand the differences between stock transfers and STOs. Practice with various valuation scenarios and understand cross-company STOs.

MM Reporting and Analytics Practice

Master the reporting capabilities to provide insights into MM processes.

Scenario 1: Standard MM Reports

Reporting Basic

Practice using standard MM reports for various analyses.

Practice Steps:

  1. Stock Reports
    • Stock Overview (Transaction: MMBE)
    • Material Stock List (Transaction: MB52)
    • Stock in Transit (Transaction: MB5T)
  2. Purchasing Reports
    • Purchase Orders by Material (Transaction: ME2M)
    • Purchase Orders by Vendor (Transaction: ME2L)
    • Outline Agreements (Transaction: ME3M)
  3. Inventory Reports
    • Material Document List (Transaction: MB51)
    • Slow Moving Items (Transaction: MC46)
    • Dead Stock Analysis (Transaction: MC40)

Configuration Tips

Learn to customize variants for frequently used reports. Practice exporting data to Excel for further analysis.

Scenario 2: Fiori Analytics Apps

Reporting Advanced

Explore and utilize S/4HANA Fiori analytical applications.

Practice Steps:

  1. Material Stock KPIs and Analysis
  2. Purchasing Spend Analysis
  3. Vendor Evaluation Dashboard
  4. Material Inventory Values
  5. Material Price Analysis
  6. Purchase Order Fulfillment Analysis

Configuration Tips

Understand how to personalize Fiori tiles and create custom dashboards. Practice adding key figures and dimensions to analyses.

Scenario 3: SAP Analytics Cloud Integration

Reporting Advanced

Explore integration with SAP Analytics Cloud for advanced analytics.

Practice Steps:

  1. Connect to SAP Analytics Cloud
  2. Create Procurement Dashboards
  3. Configure Inventory Analytics
  4. Build Predictive Scenarios
    • Demand Forecasting
    • Vendor Performance Prediction

Configuration Tips

Understand the integration points between S/4HANA and SAC. Practice with real-time and model-based reporting.

Scenario 4: CDS Views and Custom Reports

Reporting Advanced

Explore core data services views and custom reporting options.

Practice Steps:

  1. Explore Standard MM CDS Views
  2. Create Custom CDS Views for MM Data
  3. Build ABAP Reports using CDS Views
  4. Create Custom Fiori Applications with OData Services

Configuration Tips

Understand the benefits of CDS views over traditional database views. Practice creating virtual data models for reporting.

SAP S/4HANA MM Practice Guide

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