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BRIMS Batch 2012-14

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DR.V.N.BRIMS Batch 2012-14


I wish to state that the work embodied in this Project titled ----------------------------------------------------------------------------------------------------------------------------- forms my own contribution to management. Wherever references have been made to intellectual properties of any individual / Institution / Government / Private / Public Bodies / Universities, research paper, text books, reference books, research monographs, archives of newspapers, corporate, individuals, business / Government and any other source of intellectual properties viz., speeches, quotations, conference proceedings, extracts from the website, working paper, seminal work et al, they have been clearly indicated, duly acknowledged and included in the Bibliography.

_________________________ Signature of Project Guide

________________________ Signature of Candidate

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Doing summer internship in such a highly reputed company, which was created to give clients more value added services than just a consulting company. Whose sole focus is to help its clients to get the best possible return on their SAP investment and helping them to understand how new features and technologies could benefit them. Hence it has been a great opportunity to enhance ones scope of thinking and to be mature enough to appreciate things, to learn actual process, which were merely on paper during my academic years. The architecture of success stands on a strong foundation made up of strenuous hard work, determination, presence of mind and above all, timely advice and guidance from the learned and experienced people. Stressing on this words I would like to express my sincere thanks to Mr. Rajeev Kulkarni (CEO, Crave Softwares), Miss. Pallavi Kulkarni, and all other staff members for their constant support and supervision at every stage of my project. They were the pillars of my strength throughout the internship and motivated me to continue against all odds. I also extend my sincere thanks to Dr. K.Suryanarayan (Director Dr. V.N. BRIMS), Ms. Prema Mahale and all other staff members of Dr. V.N. BRIMS for their kind and generous support. Their wholehearted support made my training commendable.

Ishan N. Mahadik (Roll number: P-11, M.M.S)

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Sr. Nos. 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. Genesis of Project Company Profile Nature and Scope of the Project SAP ERP Materials Management Interpalnt Subcontracting Process Mapping of Interpalnt Subcontracting Process in SAP ERP Learning from the Project Suggestions and Recommendations Bibliography Topic Page Nos.

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DR.V.N.BRIMS Batch 2012-14

Crave Softwares is a Dubai based company founded in 2008. It was created to give clients more value added services than just a consulting company. Our sole focus is to help our clients to get the best possible return on their SAP investment. We listen, assess, advise and educate, and were pro-active, sharing knowledge and experience of the latest developments in the SAP product range and helping customers to understand how new features and technologies could benefit them. GOALS CraveSoftwares goal is to enable people to use SAP to maximize their organisations potential. CraveSoftwares comprises a network of SAP consulting experts globally and always working together to accomplish SAP system implementation and optimization of business processes. Our organisation is a prestigious world leader in SAP Consultancy with a culture which equips people with the ability to aim high, to exceed expectations, and to enjoy their work at the same time. FOCUS CraveSoftwares consulting is a customer focused highly skilled professional services consulting company specialized in SAP Enterprise Applications and Technology. We focus on building strong relationships with our partners and our clients. Our business strategy is built on our expertise in consulting, technology and outsourcing to help clients perform at the highest levels. Using our industry knowledge, service-offering expertise and technology capabilities, we identify new business and technology trends and develop solutions to help clients around the world. MISSION To thrive in todays competitive market and cope with the ever changing customer demands is making the corporate companies stand on their toes. This is why most of the companies across the globe have invested in SAP to manage their business. It is every businesses dream to get the best Return on Investment (ROI) for their SAP investments. CraveSoftwares is capable of making your dreams come true through its SAP Consulting Service. It is the mission of CraveSoftwares to empower small to large sized companies to think smarter. Our clients use our extensive knowledge in SAP to bring significant and measurable improvement in their business. Our SAP
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consultants have excellent knowledge in all the SAP software tools which can help you to make intelligent business decisions. The companies that have invested in SAP will require advice and guidance of experts who are good in technical as well as business needs. We have such experienced professional SAP consultants in CraveSoftwares who can give you excellent support for your SAP investments to create business value. We understand the needs of our clients to build solutions based on SAP in an affordable manner. Our SAP Consulting Service allows our clients to fulfill and fully make use of their SAP products to enhance the quality of their business and run it cost-effectively. OBJECTIVES CraveSoftwares objective is to provide value proposition to its clients in all aspects with satisfaction and dedicated commitment. CraveSoftwares is a business solutions leveraging company with the objective of bridging the business and technical acumen of its team, and technology of its partners to the benefit of its clients. VALUES CraveSoftwares always believes that customers deserve the best solution and service for their investments. To uphold this value, CraveSoftwares joins with its partners in delivering high quality solutions and service to meet all the clients business needs. CraveSoftwares value is to keep Quality and Price in balance to the clients advantage! We believe-in and bring-along our Values by

Innovation Integrity Team Work Technology Ownership Quality Commitment Perseverance

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1. This project is innovatory: The project aims at coming up with innovatory new ideas to improve the existing system. 2. The project is analytical: The project demands a thorough analysis of various processes within the organization especially of Internal Procurement Cross-Company Stock Transfer. 3. The project is a value adder: The project is a value adder to the system. It improvises the existing system.

1. To study in depth the process of Internal Procurement Cross-Company Stock Transfer in the organization. 2. To co-relate these various processes and functions with its implementation in SAP. 3. To analyze and find out the pros and cons of the system. 4. To put forth recommendations if any after the analyses of the system in order to improvise it.

1. Improve Efficiency: SAPs ERP system which is present in the company currently is very efficient. But one of the primary objectives of this project is recommending additional features if possible to the already existing system to improve the efficiency of the system further. 2. Better Decision Making: The recommended system with improved project scheduling features should help in better and quicker decision making. 3. Better Planning: The system should reduce the level of uncertainty in the scheduled plan and help better planning.

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SAP stands for Systems, Applications and Products in Data Processing. Five
German Engineers founded it in 1972. SAP is Enterprise Resource Planning software which large organizations use to manage their business. SAP has several modules, each of which represents a business-process. Modules are usually abbreviated for the business process they represent.

SAP Architecture:
World-wide usage
Designed to satisfy the information needs for business sizes (small

local to large all international)

Multi-lingual Multi-currency

Designed to satisfy the information needs for all industries Client/Server Environment
Hardware/software environment that can make a request for services for a central repository of resources

Hardware/software combination that can provide services to a group of clients in a controlled environment

Three Tier Structure

Graphical User Interface or Web Interface One or more, help distribute work load One single data repository

Application Server Database Server

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SAP Architecture:

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SAP is the leading ERP (Enterprise Resource Planning) software. It has a liberal open architecture. Enables a company to link its business processes. Ties together disparate business functions (integrated business solution). Enterprise Resource Planning (ERP) packages are invented to cover all areas of enterprise, also the techniques and concepts employed for integrated management of business as a whole as the data processing and integration was very complex, slow and difficult in the Pre-ERP period. ERP is a commercial software package promising the seamless integration of all the information flowing through various modules within the company like finance, human resource, supply chain, sales and distribution module etc. Introduction of ERP has led to effective use of management resources, to improve the efficiency of an enterprise. Thus, now-a-days most of the businesses have been beating paths to open the doors for ERP system. As the demand increased, the number of ERP Vendors also increased. Some of the top-tier ERP Vendors are SAP, Quadra, BAAN, PeopleSoft, Oracle and J.D. Edwards. SAP is most successful vendor of standard business application. SAPs ERP packages comes in two versions i.e. mainframe version (SAP R/2) and client-server version (SAP R/3).

SAP ERP Model:

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SAP ERP Core Applications:

Sales & Distribution Plant Maintenance Materials Management Production Planning Quality Management

Human Resources
Personnel Management Benefits Payroll

Financial Accounting Controlling Asset Management


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Every organization, big or small, depends on materials and services from other organizations to varying extents. These materials and services are obtained through exchange of money and the physical arrangement of it all is called Materials Management or even Material Management. Materials Management is a key business function that is responsible for coordination of planning, sourcing, purchasing, moving, storing and controlling materials in an optimum manner so as to provide a pre-decided service to the customer at a minimum cost. In its process of managing , materials management has such sub fields as inventory management , value analysis, receiving, stores and management of obsolete, slow moving and non moving.
Materials Management includes the following four functions:

Planning and Control

1. Inventory Management 2. Production Planning 3. Scheduling

1. Buying 2. Subcontracting

Value Analysis
1. Value analysis 2. Follow ups

Physical Distribution
1. Receiving 2. Packaging 3. Shipping & Transportation 4. Storage
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Process Flow:

SAP Materials Management:

SAP Materials Management (MM) is a part of Logistics area and helps to manage the procurement activity of an organization from procurement process, inventory management, invoice verification and material planning. The Materials Management module (SAP MM) consists of all master data, system configuration, and transactions to complete the Procure to Pay process. This process map spans from MRP generated procurement proposals through final invoice receipt and verification. Materials Management is the backbone of the Logistics area which includes modules like Sales and Distribution, Production Planning, Plant Maintenance, Project Systems, Warehouse Management which are highly dependent on Materials Management module. Materials management is highly integrated with other modules such as FI (Financial Accounting), SD (Sales & Distribution), PP (Production Planning), QM (Quality Management), PM (Plant Maintenance).

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SAP Materials Management Components: Vendor Master

Contains all the necessary information needed to business with an external supplier. Used and maintained primarily by the Purchasing and Accounting Departments. Every vendor MUST have a master record

Material Master Data

Basic Data Sales Data Purchasing Data Materials Planning Data, etc.

Consumption Based Planning Purchasing Inventory Management

Inventory management is primarily about specifying the size and placement of stocked goods. It is required at different locations within a facility or within multiple locations of a supply network to protect the regular and planned course of production against the random disturbance of running out of materials or goods.

Evaluation of Materials
Invoice Verification

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Interplant Subcontracting / Internal Procurement Cross-Company Stock Transfer includes request to transfer stock to another site, Delivery Note against stock; picking & issuing stock, processing the goods receipt, and entering a crosscompany invoice for the transferred stock.

Process Flow:
This building block contains all settings required for the configuration of cross-company deliveries. The stock transfer process starts with the requirement of transferring material from one plant to another plant. Both plants belong to the same organization but have different company codes. The difference between cross-company and intra-company stock transfer is that, for internal procurement cross-company stock transfers, inter-company billing and invoicing is required. This request, which comes in the form of a stock transfer requisition, is created in the procuring plant either automatically by MRP or manually by a buyer. However, the process also works without MRP. In this case, the buyer creates the stock transport order directly.

This scenario consists of the following steps:

Creating stock transfer order Delivery for stock transport order Goods Issue Delivery billing Receiving transferred material Purchase invoice Support of all required documents for stock transfers with delivery Support of all required master data aspects like batch management and serial numbers Monitoring the "Stock in Transit" Delivery costs can be entered in the stock transport order Supports inter-company billing and invoicing

Key Points:

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