What has changed in SAP MM with S4 HANA?

SAP MM Online Training Institute in Hyderabad

What is SAP MM in ECC?

The SAP MM (Materials Management) module in the SAP ECC (ERP Central Component) system controls processes pertaining to materials and inventory. It is a key element of the SAP ECC system and is used by businesses to simplify their materials planning, inventory management, and procurement procedures.

Here are some key functionalities and processes covered by SAP MM in ECC:

  1. Procurement: Requests for quotations (RFQs), purchase orders, purchase requisitions, and contracts are all handled by SAP MM Course. It supports a range of procurement strategies, including direct procurement, subcontracting, consignment, and the management of external services.
  2. Inventory Management: By monitoring material stock levels, stock movements, goods receipts, and goods issues, SAP MM manages inventory. It offers features for managing serial numbers, batches, and handling special stocks like consignment and stock transfers. It also offers functionalities for stock valuation.
  3. Material Valuation: Using a variety of valuation techniques, including standard price, moving average price, and actual costing, SAP MM determines the value of the materials in the inventory. It enables businesses to perform both periodic and perpetual inventory valuation and supports multiple valuation areas.
  4. Vendor Management: Companies can manage vendor master data using SAP MM, including the creation, upkeep, and evaluation of vendors. It supports choosing a vendor, rating a vendor, and negotiating the terms of a purchase.
  5. Invoice Verification: Verification and processing of incoming vendor invoices are made easier by SAP MM. It verifies invoice data, matches invoices with purchase orders and goods receipts, and ensures accurate and prompt payment processing.
  6. Material Requirements Planning (MRP): For calculating material requirements based on demand, stock levels, and planning parameters, SAP MM includes MRP functionalities. It assists in deciding when and how much to produce or purchase, ensuring that materials are available in accordance with production or sales requirements.
  7. Reporting and Analytics: To track and examine data pertaining to materials, SAP MM offers reporting and analytics capabilities. Standard reports, KPIs, and integration with SAP Business Intelligence (BI) are all provided for comprehensive analysis and decision-making.

To ensure seamless data flow and process integration across various functional areas, the SAP MM module in ECC integrates with other SAP modules, including Finance (FI), Sales and Distribution (SD), Production Planning (PP), and Quality Management (QM).

Overall, SAP MM in ECC enables businesses to effectively manage their materials, streamline their procurement procedures, and keep accurate inventory levels, all of which support efficient supply chain management within the SAP ECC system.

Changes in SAP MM with S/4 HANA compared with ECC

The fundamental architecture and technological advancements of S/4HANA and ECC (ERP Central Component) are where the main differences between the two systems lie. In the context of SAP MM (Materials Management), the following are the main differences between ECC and S/4HANA:

  1. Architecture: While S/4HANA is built on the in-memory database platform SAP HANA, ECC is built on a conventional, row-based database architecture. S/4HANA is able to provide quicker data processing, real-time analytics, and advanced functionalities thanks to this fundamental change in architecture.
  2. Data Model: Compared to the convoluted and redundant data structures in ECC, S/4HANA introduces a more straightforward data model. As a result of the reduction in aggregate and index tables, SAP MM performs better, has a smaller data footprint, and can manage data more easily.
  3. User Interface: SAP Fiori, a contemporary, role-based user interface, is introduced with S/4HANA. Users can efficiently complete MM tasks with its streamlined and intuitive user interface across devices. While ECC primarily employs the traditional SAP GUI interface.
  4. Real-time Analytics: S/4HANA makes use of SAP HANA’s in-memory computing capabilities to offer real-time analytics integrated into transactional processes. It enables immediate access to useful insights that support better SAP MM decision-making. Data extraction for analytics or separate reporting tools are both required by ECC.
  5. Performance and Speed: S/4HANA significantly outperforms ECC in terms of performance and speed thanks to SAP HANA’s in-memory computing power. S/4HANA allows for the quicker execution of transactions and processes from SAP MM, including material valuation, inventory management, and procurement.
  6. Material Ledger: The Material Ledger functionality in SAP MM is improved by S/4HANA. In place of complicated closing operations, it introduces a more straightforward method for performing real-time inventory valuation, multi-currency valuation, and parallel valuation across various accounting principles.
  7. Advanced Features: Advanced capabilities and features are added to SAP MM by S/4HANA that are not present in ECC. These consist of improved material requirements planning, embedded warehouse management, enhanced available-to-promise (aATP), and centralised procurement hub (MRP).
  8. Integration: S/4HANA offers enhanced integration with other SAP ecosystem modules and parts. Between SAP MM and modules like Finance (FI), Sales and Distribution (SD), Production Planning (PP), and Quality Management, it enables seamless data flow and process integration (QM).

It’s crucial to remember that S/4HANA represents SAP’s long-term strategy, and that ECC will eventually be phased out. The technological advancements, improved performance, and enhanced functionalities provided by S/4HANA in SAP MM Course and other modules can be advantageous to organisations making the switch from ECC to S/4HANA.