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This document marks the completion of the Business Blueprint phase of the SAP R/3
implementation for Quality Polymer. With this acceptance, the following document is confirmed and
becomes the basis for the next phase (Realization) to proceed.
Name
Title
Veno Gober
Janet Ling
Ng Hong Chee
Project Advisor
Project Manager
Team Leader, Technical
Adeline Lee
Project Manger
Team Leader, Purchasing and Invoice
Verification
Ramesh
Sunkarapalli
Signature
Date
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Table of Contents
1
2
Executive Summary.......................................................................................................... 1
Quality Polymer Rollout Project Overview.....................................................................2
2.1 Project Organization...................................................................................................2
2.2 Project Scope............................................................................................................. 3
2.3 Project Timeline.........................................................................................................3
Organization Structure.....................................................................................................5
3.1 Financials................................................................................................................... 5
3.1.1 Financials Organization Structure...................................................................5
3.1.1.1 Credit Control Area..........................................................................5
3.1.1.2 Cost Center Hierarchy.....................................................................6
3.1.1.3 Profit Center Hierarchy....................................................................7
3.2 Logistics..................................................................................................................... 8
3.2.1 Sales Organization Structure..........................................................................8
3.2.1.1 Sales Area.......................................................................................8
3.2.1.2 Shipping Point..................................................................................9
3.2.2 Purchasing Organization Structure.................................................................10
3.2.3 Inventory Management Organization Structure..............................................11
3.2.3.1 Storage Locations for Quality Polymer.............................................11
Master Data....................................................................................................................... 13
4.1 Financials................................................................................................................... 13
4.1.1 Order Type.....................................................................................................13
4.2 Logistics..................................................................................................................... 13
4.2.1 Customers and Vendors.................................................................................13
4.2.2 Material Types................................................................................................13
4.2.3 Material Types, Material Groups and Number Ranges...................................14
4.2.4 Material Valuation and Account Determination...............................................14
4.2.5 Product Hierarchy...........................................................................................14
4.2.6 Batch Management........................................................................................14
4.2.7 Shelf Life Expiration Date (SLED) and Classification for Batch Specification. 15
4.2.8 Bill of Materials (BOM)...................................................................................15
4.2.8.1 Material BOM...................................................................................15
4.2.8.2 Alternate BOM.................................................................................16
4.2.9 Master Recipe................................................................................................16
4.2.10 Recipe Group.................................................................................................16
4.2.11 Resources (Work Centers).............................................................................16
4.2.11.1 Processing Unit:.............................................................................16
4.2.11.2 Labor:............................................................................................16
4.2.12 Production Versions........................................................................................17
To-Be Business Scenarios...............................................................................................18
5.1 Sales and Distribution................................................................................................18
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Table of Exhibits
Figure 2.1.1: Rollout Project Organization........................................................................................2
Figure 2.2.1: Scope of Quality Polymer Rollout................................................................................3
Figure 2.3.1: ASAP Implementation Methodology............................................................................3
Figure 2.3.2: Timeline for Quality Polymer Rollout............................................................................4
Figure 3.1.1: Mapping of Credit Control Area...................................................................................5
Figure 3.1.2: Mapping of Cost Center Hierarchy..............................................................................6
Figure 3.1.3: Mapping of Profit Center Hierarchy.............................................................................7
Figure 3.2.1: Mapping of Sales Area................................................................................................8
Figure 3.2.2: Mapping of Shipping Point...........................................................................................9
Figure 3.2.3: Mapping of Purchasing Organization Structure.........................................................10
Figure 3.2.4: Mapping of Inventory Management Organization Structure.......................................11
Figure 3.2.5: Storage Locations for Quality Polymer......................................................................12
Figure 4.1.1: Order Types............................................................................................................... 13
Figure 4.2.1: Material Types........................................................................................................... 13
Figure 4.2.2: Material Types, Material Groups and Number Ranges..............................................14
Figure 4.2.3: Additional Product Hierarchy for Quality Polymer......................................................14
Figure 4.2.4: Batch Number Assignment........................................................................................14
Figure 4.2.5: Sample of a BOM......................................................................................................15
Figure 9.1.1: NPM System Landscape & Additional Server for Quality Polymer Rollout.................31
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1 Executive Summary
This report contains the conceptual design of the SAP R/3 system for Quality Polymer. The
Business Blueprint document maps and translates the To-be business requirements of Quality
Polymer, which were gathered during the business workshops, into design decisions in the SAP
R/3 system. As this is a rollout implementation from Nippon Paint SAP R/3 system, Quality
Polymer will adopt most of the relevant business scenarios and business processes from Nippon
Paint Malaysia (hereafter also referred to as NPM).
The main purpose of this report is to describe and freeze the scope of implementation, in order to
ensure a timely, effective and successful implementation. The report will highlight all the adopted
business scenarios from Nippon Paint Malaysia and focus on the additional business scenarios
and business processes.
Quality Polymer will fall under the NPM umbrella of controlling area, thus, fully using the company
code that has already been setup during Project Cheetah Implementation. Company code for
Desa Baiduri, a subsidiary of Quality Polymer, will also be introduced for this rollout
implementation. Costs incurred by departments and sub-departments can be viewed in a cost
center hierarchy. These can be matched against the revenue generated by Profit centers, which
will also be structured to the companies.
As with all SAP R/3 company codes in NPM, Quality Polymer will share the same credit control
area, continuing the trend to consolidate credit limit per customer buying from more than one
company. Quality Polymer will have one Sales Organization and Distribution Channel to handle
its sales processing. A single Purchasing Organization is also identified to handle the
procurement for the whole company.
For the logistics structure under the company code, one plant with multiple storage locations is
used to monitor the inventory of the company. This plant will also be the production plant for all of
Quality Polymer productions.
Four different storage locations are used to house the four raw materials tanks and another
twelve storage locations are used to map to the twelve storage tanks for the finished goods.
There will be other storage locations identified for other logical mapping.
Finally, it is important to note that the conceptual design detailed in this document is to streamline
expectations and clarify the scope, which will act as a base for the remaining phases.
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Project Organization
The Rollout Project is under the responsibility of the Steering Committee, which is headed by the
MD of Quality Polymer, Lee Buck Siang. Daily project activities were undertaken by the project
team members from the combination of core Project Cheetah Team Leaders from each module,
identified key users from Quality Polymer and ea Consultants under the supervision of the
internal project managers, Choo Kim Soon and the external project manager Adeline Lee. In
addition, ea Consulting Manager, Alfred Chong provides quality review and overall project
direction with Mr. Yaw Seng Heng as the Project Advisor on the best business processes to adopt
from NPM.
Steering
Steering Committee
Committee
Project
Project Sponsor
Sponsor
Mr
Mr Lee
Lee Buck
Buck Siang
Siang
Quality
Quality Review
Review
Alfred
Alfred Chong
Chong
Project
Project Advisor
Advisor
Yaw
Yaw Seng
Seng Heng
Heng
Project
Project Manager
Manager
Adeline
Adeline Lee
Lee (ea)
(ea)
Mr
Mr Lee
Lee Buck
Buck Siang
Siang (MD)
(MD)
Mr
Mr Yaw
Yaw Seng
Seng Heng
Heng (GM)
(GM)
Mr
Mr Leong
Leong Wai
Wai Khoon
Khoon
Ms
Ms Wong
Wong Siew
Siew Ying
Ying
Adeline
Adeline Lee
Lee (ea)
(ea)
Alfred
Alfred Chong
Chong (ea)
(ea)
Choo
Choo Kim
Kim Soon
Soon
CoCo- Project
Project Manager
Manager
Choo
Choo Kim
Kim Soon
Soon
BASIS/ABAP
BASIS/ABAP
Choo Kim Soon
(TL)
Lee Kian Ann
Damodaran
FICO
FICO
MM/PUR
MM/PUR
SD
SD
PP
PP
Ng Hong Chee (TLProcess)
- Zawiah (PU)
Janet Ling (TL-Master
Data)
Lum (QP)
Ramesh SV(ea)
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Project Scope
As this is a rollout system from NPM, with the exception of Warehouse Management, all modules
will be rolled out to Quality Polymer. Desa Baiduri, being a subsidiary of Quality Polymer will only
be implemented with the Financial and Management Accounting Module. The table below
denotes the modules that will be implemented for the two companies.
Existing NPM SAP Module
Quality
Polymer
Financial Accounting (FI)
Yes
Management Accounting (CO)
Yes
Sales and Distribution (SD)
Yes
Purchasing (MM-PUR)
Yes
Invoice Verification (MM-IV)
Yes
Inventory Management (MM-IM)
Yes
Warehouse Management (MM-WM)
Production Planning (PP)
Yes
Figure 2.2.2: Scope of Quality Polymer Rollout
2.3
Desa
Baiduri
Yes
Yes
-
Project Timeline
The implementation approach for the rollout project is based on the Accelerated SAP (ASAP)
implementation methodology. ASAP is broken into five stages as shown in the diagram below:
ASAP Methodologies
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The purpose of this stage is to document the Business Blueprint, which maps the business
requirements into SAP and defines the approaches to be used in activities like conversion,
training and testing under the Realization phase. It is the result of requirement gathering
workshops and prototyping efforts. The Business Blueprint is an important component of ASAP
as it specifies the conceptual design on which the rest of the implementation is based.
Stage 3 Realization
The purpose of this stage is to configure all of the business requirements based on the Business
Blueprint conceptual design. The objectives are to configure the system, develop and test
interfaces, conversion programs, enhancements and reports as well as conduct overall
integration test. System authorizations are also created, user acceptance tests are conducted,
and preparation for end user training is established.
Stage 4 - Final Preparation
The purpose of this stage is to prepare for going live. Activities in this phase include end-user
training, system management, and actual conversion of live data, cut-over activities and
formation of an internal help desk to support the organization after going live.
Stage 5 Go-Live and Support
The purpose of this stage is move from a pre-production environment to a live production
operation environment. A support team for power users must be formed for the initial critical days
of going live as well as to support end users for a long-term period.
The Rollout Project commenced on 8th October 2003 and is a three-month project
implementation. The integration of the logistics modules and the financial modules demand an
aggressive timeline as depicted in the diagram below.
Project Timeline
Project Management
ASAP Phase
Oct
Nov
Dec
Jan
Weeks
Project Preparation
Business Blueprint
Realization
Final Preparation
Go Live & Support
Note: 15 weeks project with
certain weeks overlapping
3
Go
Live
Total
2
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3 Organization Structure
3.1
Financials
300
Production
Client
1000
Nippon Paint
Company Code
7000
Quality Polymer
Sales Organisation
7000
Quality Polymer
7100
Desa Baiduri
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70101000
Production
70103000
Technical
70102000
QC
70000000
Quality Polymer
71000000
Desa Baiduri
70100000
Pasir Gudang
71100000
Pasir Gudang
70106000
FG W/hse
70104000
Sales &
Marketing
70109000
Safety &
Health
70108000
Management
70111000
Purchasing
70110000
Finance &
Audit
70113000
IT
70199000
Dummy
70112000
HR & Gen
Admin
70101300
Emulsion
70112100
Human Resources
70101500
Raw Materials
70112200
General Admin
71101000
Gen Admin
71102000
Sales
70101600
Maint & Water
Treatment
1000
Controlling Area
70101700
Factory Office
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NPGROUP
Nippon Paint Group
70000000
Quality Polymer
71000000
Desa Baiduri
70100000
Pasir Gudang
71100000
Pasir Gudang
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Logistics
Company Code
7000
Quality Polymer
Sales Organisation
7000
Quality Polymer
Distribution Channel
Division
7A
Pasir Gudang
01
General
Sales Area
Sales Office
7001
Pasir Gudang
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Company Code
7000
Quality Polymer
Sales Organization
7000
Quality Polymer
Distribution Channel
7A
Pasir Gudang
Plant
7001
Pasir Gudang
Shipping Point
7001
Pasir Gudang
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Company Code
7000
Quality Polymer
Purchasing
Organisation
7000
Quality Polymer
Purchasing Group
Plant
100
Raw material
purchases
300
Non-stock and
services items
purchases
400
Trading items
301
Other item
purchases
7001
Quality Polymer
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Company code
7000
Quality Polymer
Plant
7001
Quality Polymer
3000
Finished
goods
3701
FG
tank 1
Storage
Locations
3702
FG
tank 2
1000
Raw
material
WH
3703
FG
tank 3
3704
FG
tank 4
1101
1102
Monomer
tank 1
Monomer
tank 2
3705
FG
tank 5
1103
monomer
tank 3
3706
FG
tank 6
1104
Monomer
tank 4
3707
FG
tank 7
2200
EM Plant
3708
FG
tank 8
2400
Maintenance
Misc
3709
FG
tank 9
4000
Waste
3710
3711
3712
FG
tank 10
FG
tank 11
FG
tank 12
5000
5100
Technical
Dept
Marketing
Misc
Location Description
Raw Material Warehouse
1101
1102
1103
1104
2200
Monomer tank 1
Monomer tank 2
Monomer tank 3
Monomer tank 4
EM Plant
2400
Maintenance Misc
Type of Storage
It stores raw materials such as additives, catalyst and
Surfactant
Stores monomer
Stores monomer
Stores monomer
Stores monomer
Represents Quality Polymer Production area that stores raw
materials before it goes into production.
Stores filter bags, parts, boiler materials, water treatment
materials and indirect materials
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Storage Location
3000
Location Description
Finished Goods
Type of Storage
Serves as a temporary storage location and stores finished
goods.
3701
3702
3703
3704
3705
3706
3707
3708
3709
3710
3711
3712
4000
5000
5100
FG tank 1
Represents Storage Tank 1
FG tank 2
Represents Storage Tank 2
FG tank 3
Represents Storage Tank 3
FG tank 4
Represents Storage Tank 4
FG tank 5
Represents Storage Tank 5
FG tank 6
Represents Storage Tank 6
FG tank 7
Represents Storage Tank 7
FG tank 8
Represents Storage Tank 8
FG tank 9
Represents Storage Tank 9
FG tank 10
Represents Storage Tank 10
FG tank 11
Represents Storage Tank 11
GF tank 12
Represents Storage Tank 12
Waste
Stores disposed product ie. Sludge etc.
Technical Dept
Stores materials from QC Lab
Marketing Misc
Stores T-shirts, uniforms, calendars etc.
Figure 3.2.12: Storage Locations for Quality Polymer
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4 Master Data
4.1
Financials
Quality Polymer will adopt the chart of accounts and account groups from NPM.
4.1.1 Order Type
Internal orders are used to collect, monitor and settle costs. The order types to be used by Quality
Polymer are as follows:
Order Type
7EMP
7VEC
7FOK
7MKT
7RPC
7QP1
7DIS
4.2
Name
Staff Expenses
Motor Vehicle Expenses
Forklift Maintenance
Marketing & Promotion/Project Expenses
Repacking Order
Quality Polymer Ad-Hoc Order
Quality Polymer Discount
Figure 4.1.13: Order Types
Range
From
710000
720000
730000
740000
760000
770000
External
To
719999
729999
739999
749999
769999
779999
External
Logistics
Material Description
Raw Material
HALB
Semi-Finished Product
FERT
HAWA
ZIND
Finished Goods
Trading Goods
Indirect Material
LEIH
VERP
PIPE
Returnable Packaging
Packaging Material
Pipeline Material
ZDM
Development Materials
ZWTM
Waste Materials
Types of Material
Raw material used to produce finished goods. The loose finished
goods will also be identified by this material type, due to the NPM
design that has been up.
Semi-finished goods produced in-house or through subcontractor,
and it is used to produce finished goods.
Final product from production and pack in various packaging sizes.
Materials purchased externally and sell to customer.
Materials that are not part of trade, and mainly classified as
consumable material for used in production such as Boiler
materials, Water treatment chemicals, consumables and cooling
towers.
Packaging materials such as tote tanks.
Packaging materials such as tote tanks, drums and pails.
Materials such as water that flow into the production process
directly.
Material record is created for costing simulation purpose. This
material type will not allow quantity or value updates.
Materials used to track waste generated. This material is managed
at quantity basis only.
Figure 4.2.14: Material Types
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Material Group
Material Description
Number Range
ROH008
Monomer
M001 M999
VERP005
Tote
PT0000000 PT9999999
VERP006
IBC
PI0000000 PI9999999
ZIND009
Boiler Materials
IM521 IM530
ZIND010
Consumables
IM531 IM540
ZIND011
Cooling Towers
IM541 IM550
Figure 4.2.15: Material Types, Material Groups and Number Ranges
Product Hierarchy
First Level
Second Level
Third Level
200021010200000005
20002
2000210102
Vinyl Acetate Copolymer
Latex
Copolymer
200021010400000006
20002
2000210104
Homo Polymer
Latex
Others Latex
200041030000000012
20004
2000410300
Catalyst
Additive
Water Based Additive
2000810700
20008
Monomer
Monomer
Figure 4.2.16: Additional Product Hierarchy for Quality Polymer
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All batches will have internally assigned numbering. Batch records will be created upon goods
receipt as per purchase order and upon release of process orders for materials produced inhouse
4.2.7 Shelf Life Expiration Date (SLED) and Classification for Batch Specification
SLED and Classification is also adopted in Quality Polymer Rollout. Together with the production
date, SLED will provide Quality Polymer with the material expiration date while the classification
will store all the Quality Inspection Specification for any particular batch.
4.2.8
The Bill of material (BOM) can de defined as a formally structured list of components that make
up a finished product or semi finished product. For Quality Polymer, the following types of BOM
will be created:
4.2.8.1 Material BOM
The components of a material BOM are defined as components that are used during the
production process. A BOM specifies the proportion or the actual quantities of the lower level
components to be used in the final product. The highest level of the BOM is defined as level
zero. Generally for Quality Polymer, up to three (Level 0-2) levels of BOM will be identified
(Currently only one material has 4 Levels of BOM).
Example of a BOM to manufacture product L012BC1 (current material naming convention):
L012BC1
Level 0
L012
M001
BC1
SR7000
M002
Level 1
Level 2
M003
Level 3
Level 0 will be for the finished product with a specific packing size. Level 1 will consist of the
loose semi-finished material and packaging material. Level 2 and below will consist of semifinished and raw materials to manufacture the semi-finished product of the next higher level.
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Different production processes for the same material. For example, the production
process can be different if a similar material is produced for two different lot sizes.
Similar production processes for different materials. Like two different materials
may have the same production process
For Quality Polymer, the numbering for the Recipe Group will be internally assigned as follows :
Type of Group
Recipe Group
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In addition to new business scenarios that are specific only to Quality Polymer, Quality Polymer
will also adopt the following Sales and Distribution business scenarios from NPM:
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Before the tanker is filled up with the loose FERT from the storage tank, the tanker must be
weighed to obtain the Berat Tanpa Muatan (BTM). After the tanker has been filled up, the tanker
will be weighed again to obtain the Berat Dengan Muatan (BDM). Goods are issued as per the
quantity difference between the BTM and BDM.
After the process order has been confirmed, a goods receipt is done for the process order and
the Production Department will inform the Sales Administrator the confirmed quantity. The Sales
Administrator creates the delivery order based on the confirmed quantity.
Another round of credit limit check is done for each delivery order. This is to safeguard the
change of customers credit limit status from the time of sales order to the delivery order.
However, depending on additional credit limit settings, sales orders that have been approved
might not be subject to checking during delivery order.
As in sales order processing, if the customer does not pass the credit limit, a block will be
imposed on the delivery order. No further processing of the delivery order is possible until the
Credit Representative has released the credit limit block. The delivery order is printed after the
Sales Administrator post goods issue for the delivery order. The Gate Pass will also be created. A
printout of the Gate Pass is given to the transporter for security clearance before leaving the
premises of Quality Polymer.
The Sales Administrator will only generate billing documents to the customer once the transporter
has returned a copy of the delivery order to Quality Polymer. When the billing document is
generated in SAP, an accounting document is also recorded immediately in the customer
accounts receivable. With this posting, the Finance Department will clear the invoice against
incoming payment received.
5.1.2 BS130 Sales from Stock (Tote Tank)
When a customer confirms a sale with Quality Polymer, the Sales Administrator needs to create
the sales order in SAP. The Sales Administrator will create a sales order based on the customer
purchase order. In addition to the material requested, the Sales Administrator will also have to
enter an additional line item for returnable packaging
If the purchase order is from NPM, the Sales Administrator cannot use the material number from
the purchase order but have to select the appropriate material number based on the unit of
measure in the purchase order.
SAP will perform availability check for all items in the sales order. The availability check will allow
the Sales Administrator to verify if the requested delivery date can be met or a new delivery date
is to be proposed.
When the sales order is saved, SAP performs a check on the customers credit limit. Depending
on the customers credit status, different criteria can be set for credit limit check. If the customer
does not pass the credit limit, a block will be imposed on the sales order. No further processing
of the sales order is possible until the approval is executed.
When the sales order is free from the credit limit block or the credit limit block has been released
by the Credit Representative, it is possible to create the delivery order immediately for urgent
delivery. Alternatively, the Sales Administrator runs the delivery due list and creates delivery
orders for all the sales orders that are due for delivery.
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Another round of credit limit check is done for each delivery order. This is to safeguard the
change of customers credit limit status from the time of sales order to the delivery order.
However, depending on additional credit limit settings, sales orders that have been approved
might not be subject to checking during delivery order. As in sales order processing, if the
customer does not pass the credit limit, a block will be imposed on the delivery order. No further
processing of the delivery order is possible until the Credit Representative has released the credit
limit block.
The Warehouse Personnel generates a list of delivery orders that are due for picking and prints
the picking list. After picking is done, the Warehouse Personnel will update the delivery order
with the confirmed quantity and post goods issue. The Gate Pass will also be created. A printout
of the Gate Pass is given to the transporter for security clearance before leaving the premises of
Quality Polymer.
The Sales Administrator will only generate billing documents to the customer once the transporter
has returned a copy of the delivery order to Quality Polymer. When the billing document is
generated in SAP, an accounting document is also recorded immediately in the customer
accounts receivable. With this posting, the Finance Department will clear the invoice against
incoming payment received.
Please refer to BS147 Handling of Returnable Packaging for the return of the tote tank from the
customer to Quality Polymer.
5.2
In addition to new business scenarios that are specific only to Quality Polymer, the following
Purchasing and Invoice Verification business scenarios will also be adopted from NPM:
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approval, also known as the Release Strategy in the SAP system. The levels of approval is
dependent on the Purchase Order amount as below:
1. Level 1
< RM5,000
2. Level 2
3. Level 3
Upon approval of the Purchase Order, a hardcopy will be printed out and sent / faxed to the
vendor.
When the vendor finally delivers the goods to Quality Polymers warehouse, a Goods Receipt
transaction will be performed in the system to denote the acceptance of goods into warehouse.
With this, an accounting document will also be recorded in the system. For good that are batch
managed, SAP generates an internal batch number. Therefore it is important to record the
vendors batch number during Goods Receipt as this will provide a cross reference between SAP
batch number and the Vendors batch number.
Vendors will usually delivers the goods with a copy of Delivery Order and Invoice attached. The
invoice will be entered into a system, whereby 3-way-matching of the quantity an amount will be
done in the system by comparing the Purchase Order, Goods Receipt and the Vendors Invoice.
If everything is found to be consistent, payment will be arranged by the Quality Polymers Finance
Department to the Vendor. Otherwise, Variance Verification will need to be performed among the
Quality Polymers Purchasing, Finance and the Warehouse.
5.2.2 BS233 Vendor Consignment of IBC tote
This scenario refers to the management of IBC totes, which is one of the packaging materials
used in Quality Polymer.
As and when there is a requirement from Production Department and there is a shortage of IBC
totes, the Purchaser will communicate with the IBC vendor to order for an estimated quantity of
IBC totes. A Consignment Purchase Order will be created in the system. The IBC vendor will
deliver to the Store in Quality Polymer and Goods Receipt can be performed in the system as
non-valuated stock.
When these IBC totes are being used up to pack Finished Goods, a Transfer of Consignment
Stock needs to be done by performing a Goods Issue transaction in the system valuated at the
price charged by the IBC vendor.
Upon shipping out the Finished Goods, Quality Polymer will fax a copy of the BL (Bill of Lading) to
the IBC vendor. From the BL, the IBC vendor will be able to determine the quantity of IBC totes
that they will be invoicing Quality Polymer for. Quality Polymer will then make payment to the IBC
vendor.
5.3
Inventory Management
In addition to new business scenarios that are specific only to Quality Polymer, the following
Inventory Management business scenarios will also be adopted from NPM:
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5.4
Production Planning
After the Production production plan is finalized, the data is transferred to demand Demand
management Management by the sales Production Department manually, for each material to
SAP. A monthly Production production plan is created for every material for the next 12 months.
5.4.2 BS331 Production Planning - Make to Stock
This business scenario caters for the make to stock (MTS) production planning for all the
Finished goods/Semi-finished goods of Quality Polymer.
For Make To Stock Production Planning, the figures transferred to demand management will form
the basis for production.
In Demand Management, the requirement for each material is created for each finished material
as Planned Independent Requirements. A planned independent requirement contains one
planned quantity and one date, or a number of planned independent requirements schedule lines,
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that is, one planned quantity split over time according to dates. The Production Department can
split this requirement into weekly or daily time buckets.
MRP plans for all the materials in the plant.
During the MRP run, planned orders are created for both external procurement and internal
production, based on the selections in material master. The system calculates the net
requirement for all the materials based on the available quantity. Subsequently a monthly/weekly
schedule is prepared. The raw material shortages from planned orders are found in the Raw
Material Shortage Report. The Raw Material Shortage Report has to be reviewed by the
Purchasing Department for follow up with the vendor. The Buyer converts the planned order to a
purchase requisition that can be converted to a purchase order at a later date.
The Buyer issues the purchase order to the vendor and follows up with the vendor for delivery
dates. If the vendor cannot meet the delivery date, the Buyer has to reschedule the delivery date
and inform the Production Planner. If the new delivery date of the raw material affects the
customer promised date, the Production Planner has to inform the Order Processing Department
for necessary actions.
The Production Department creates the process orders or converts the planned orders based on
the production plan. The following fields are specified on the initial screen during the process
order creation:
Material no. - The semi finished or finished material, for which the process order is to
be created.
Production plant - The plant in which the process orders needs to be executed or
produced.
Process order type - The process order type distinguishes usage in Production. For
Quality Polymer, different process order types are defined for the Normal Order, Reprocessing, Pilot Production and Development Item.
The user specifies the scheduled date of production for the semi finished and finished products,
and whether the scheduling type is backward or forward scheduling. In forward scheduling, the
user has to specify the basic start date of production. For backward scheduling, the user has to
specify the basic finish date of production. The system chooses the first alternative BOM and
default master recipe for the process order. If the user wants to use a different BOM, the BOM
has to be selected manually. The user also checks the availability of raw materials. If the raw
materials are available, the process order can be released.
The Production Planner saves the process order and a process order number is generated.
After the process order has been saved and released, goods movement is allowed for the
process order. If materials are required from the warehouse, the Production Planner furnishes
the material shifting requirement to warehouse to transfer materials to the Production Storage
Location on the production floor.
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Goods are issued as per the planned raw material quantity from the Production Storage Location
to the process order.
After all the materials are issued to the process order, the Production Department initiates
production. Capacity is checked at each work center. If sufficient capacity is not available, the
Production Department reschedules the process order. The process instructions for each phase
and operation are used to carry out each process step of the production. After the goods are
produced, the actual usage of the resources for the process order is confirmed using the standard
values and activity types defined in the master recipe of the product. The standard values used
are machine hours and labor hours.
The Production Planner needs to update the goods issue to the process order before confirming
the process order. This information will be used to calculate the actual production cost and
variance during process order settlement in product costing.
After production is completed, a goods receipt is done for the process order and goods are
transferred to the warehouse.
5.4.3 BS352 Production Planning Pilot Production for New Materials
This business scenario caters to production planning of pilot production for new materials by
Production Department. The quantity for this production type is generally less than 400 kg. Pilot
production is generally for new materials that has been tested in the lab, and now needs to be
produced in an up scale quantity to verify the accuracy of the BOM and master recipe.
Production Department of Quality Polymer receives requirement for small lot production,
generally less than 400kg. Technical Department of NPM creates the material code for the
material to be produced by Production Department of Quality Polymer in the system.
Production Department creates the BOM and master recipe. Once the master data has been
setup, process order is created using a different process order type. After the process order has
been saved and released, goods movement is allowed for the process order.
The Production Department initiates production after all the materials have been issued to the
pilot reactor. After the goods are produced, the actual usage of the materials for the process
order is confirmed
5.4.4 BS 353 Production Planning - Canning Balance
This business scenario caters for the consumption of canning balance in production. The
canning balance is defined as the leftover loose material less than the standard packing size.
Production Department receives the requirement for new demand in the form of sales forecast or
sales order and checks if canning balance is available for this demand.
If the canning balance is available, Production Department uses this canning balance as a
component in Process Order for the new demand.
Production Department runs desktop MRP for this material desktop. The system nets off the
demand by the canning balance quantity.
The Production Department creates the process orders based on the production plan.
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The user specifies the scheduled date of production for the semi finished and finished products,
and whether the scheduling type is backward or forward scheduling. In the process order
material list screen, an additional line is included for the canning balance as a component. The
user also checks the availability of raw materials. If the raw materials are available, the process
order can be released.
After the process order has been saved and released, goods movement is allowed for the
process order. The Production Department furnishes materials requirement list for the Process
Order to Warehouse. Warehouse will transfer all the materials, based on the list, to the
designated Production Storage Location.
When all the materials are issued to the process order, the Production Department initiates
production.
After the goods are produced, the actual usage of the resources for the process order is
confirmed.
Upon completion, a goods receipt is performed for the process order and goods are transferred to
the warehouse.
5.4.5 BS347 Production Planning - Reprocess fFormula
This business scenario caters for the following situations where the Technical Department
evaluates the possibility of creating a reprocess formula to consume old stock:
The Technical department evaluates the possibility of creating a reprocess formula for this stock.
If the reprocess formula can be created, then the old stock will be consumed.
Flow 1:
Production departmentDepartment reviews the stock report to identify slow moving materials,
expired materials and the customer returned materials in the warehouse . This triggers the
requirement for Production departmentDepartment to create Process Order with a different Order
Type.
Flow 2:
The Production departmentDepartment creates alternative BOM for the reprocess material. The
alternative BOM contains the returned material and other raw materials. The alternative BOM is
created together with a Production production Version version for reprocessing. The alternative
BOM may be used for all returned batches of the same material because there is not much
difference in the components and quantity of the various batches. The technicalProduction
departmentDepartment needs to create only one alternative BOM for all the batches.
Flow 3:
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The Production departmentDepartment creates the process order based on the reprocess
formula (alternate BOM). The following fields are specified on the initial screen during process
order creation:
Material No.
The semi finished or finished materials for which the process order is to be created.
Production plant
The plant in which the process orders needs to be executed or produced.
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Warehouse checks the process order and identifies the old or returned stock to be used based
on the process order type. The old or returned stock is to be used before placing any new
requirements.
Warehouse transfers goods to the Production Storage Location. Goods are issued from the
Production Storage Location to the process order.
Flow 7:
The transfer requirement generates a transfer order to the warehouse for transferring goods.
Warehouse transfers goods to the production supply area based on the transfer order.
Flow 8:
Goods are issued per the planned raw material quantity from the production supply area to the
process order.
Flow 9:
After all the materials are issued to the process order, the pProduction departmentDepartment
initiates production. Capacity is checked at each work center. If sufficient capacity is not
available, the Production department reschedules the process order. The process instructions for
each phase and operation are used to carry out each process step of the production. Upon
completion, the actual usage of the resources for the process order is confirmed using the
standard values and activity types defined in the master recipe of the product. The standard
values used are machine hours and labor hours.
If the actual usage of the material is different from the planned, the Production Planner needs to
update the process order before confirming the process order. This information will be used to
calculate the actual production cost and variance during process order settlement in product
costing.
Flow 10: Goods receipt is also done for the process order and goods are transferred to the
warehouse.
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The semi finished or finished materials for which the process order is to be created.
Production plant
The plant in which the process orders needs to be executed or produced.
Process order type
The process order type distinguishes type of usage in production.
The user specifies the scheduled date of production for the semi finished and finished products,
and whether the scheduling type is backward or forward scheduling. In forward scheduling, the
user has to specify the basic start date of production. For backward scheduling, the user has to
specify the basic finish date of production.
Flow 3:
Flow 4:
The transfer requirement generates a transfer order to the warehouse for transferring goods.
Warehouse transfers goods to the production supply area based on the transfer order.
Flow 5:
Goods are issued per the planned raw material quantity from the production supply area to the
process order.
Flow 6:
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The Production departmentDepartment identifies common semi finished materials with low stock
level by comparing available stock with the stock level predefined in the material master.
Flow 3:
The Production departmentDepartment then creates the process orders based on the production
plan. The following fields are specified on the initial screen during process order creation:
Material No.
The semi finished or finished materials for which the process order is to be created.
Production plant
The plant in which the process orders needs to be executed or produced.
Process order type
The process order type distinguishes type of usage in production.
The user specifies the scheduled date of production for the semi finished and finished products,
and whether the scheduling type is backward or forward scheduling. In forward scheduling, the
user has to specify the basic start date of production. For backward scheduling, the user has to
specify the basic finish date of production.
The Production Planner saves the process order and a process order number is generated.
Flow 4:
Once the process order has been saved and released, goods movement is allowed for the
process order. If materials are required from the warehouse, the Production Planner processes
the material staging requirement to create the requirement for warehouse to transfer materials to
the production supply area on the production floor.
Flow 5:
The transfer requirement generates a transfer order to the warehouse for transferring goods.
Warehouse transfers goods to the production supply area based on the transfer order.
Flow 6:
Goods are issued per the planned raw material After all the materials are issued to the process
order, Production departmentDepartment initiates production. Capacity is checked at each work
center. If sufficient capacity is not available, the Production department reschedules the process
order. The process instructions for each phase and operation are used to carry out each process
step of the production. Upon completion, the actual usage of the resources for the process order
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is confirmed using the standard values and activity types defined in the master recipe of the
product. The standard values used are machine hours and labor hours.
If the actual usage of the material is different from the planned, the Production Planner needs to
update the process order before confirming the process order. This information will be used to
calculate the actual production cost and variance during process order settlement in product
costing.
Flow 8:
After production is completed, a goods receipt is done for the process order and goods are
transferred to the warehouse.
5.4.8
5.4.9
5.4.10
5.5
Financial Accounting
Quality Polymer will adopt the following Financial Accounting business scenarios from NPM:
BS404 Treasury
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Controlling
Quality Polymer will adopt the following Controlling business scenarios from NPM:
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7 Conversion Approach
Conversion will be carried out to ensure that Quality Polymer will have all the relevant information
when the system goes live. Preparation for conversion is required during the implementation
because it is important to start the new system with clean and relevant data that is not obsolete.
The approach used in data conversion will be as follows:
7.1
Conversion strategy
Due to the low volume master data in Quality Polymer, with the exception of GL accounts and its
open items, the user will manually enter all conversion objects into the Production System. Prior
to the manual entry to the Production System, the users input the data into the Quality System to
verify the data integrity and accuracy. This exercise also serves as a training and confidence
building for the users to familiarize themselves with SAP R/3.
7.2
Data to be converted is identified with object description and the total number of records is
estimated. These data will be classified as master or transaction files depending on the type of
data converted. (A summary of these conversion data objects is found in the Appendix).
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The sources of data must be cleaned to ensure that the correct information is later entered to
SAP. This entails removal of duplicate records (like customer or vendor master records), data
consolidation, providing new pieces of information required in the new system and ensuring that
existing information is up-to-date. This responsibility rests solely on NPM team leaders and
Quality Polymer end-users.
7.3
Actual Conversion
Conversion of live data to SAP will occur during the Final Preparation phase. In general, master
data will be converted before transaction data. The latter is performed immediately after the
period closing of the legacy system and for the new SAP system to run live at the start of the
period (month). One way of minimizing transaction data to be converted is to ensure that all open
items are settled before the conversion process.
Prior to go-live date, all entered data must be verified in the production system to ensure
completeness and consistency.
8 Authorizations
New Authorization Profiles will be setup for all Quality Polymer users. This authorization profiles
will enable the users to have a control environment on their access level in terms of the different
transaction codes and organization structure that each user can have access to.
The Team Leaders will work closely with Quality Polymer management to determine the different
level of access that each user can have. Quality Polymer will adopt the Authorization Policy that
is in placed for NPM.
9 System Landscape
9.1
System Environment
Current NPM system landscape consists of three physical servers, each housing a single client
as illustrated below
For Quality Polymer rollout, all configurations will be set in the Development Server. An additional
server has been setup for the role of testing by consultants and team leaders. This server will be
a copy of the Production Server Client 300. Prototype will take place in the Additional Server
while training and user acceptance test will be conducted in Quality System Server Client 300.
The diagram below depicts the system landscape of existing NPM servers and the additional
server for Quality Polymer rollout implementation.
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Current NPM
System Landscape
Development Server
(Client 140)
Additional Server
For QP Rollout Playground
Quality System Server
(Client 300)
Production Server
(Client 300)
Transport Route
Figure 9.1.19: NPM System Landscape & Additional Server for Quality Polymer Rollout
9.2
Transport Strategies
The transport strategy for Quality Polymer Rollout has to be monitored manually. As depict in
Figure 9.1.1., all configurations settings will still be done in Development Server Client 140. The
consultants will manually transport it to the Quality Polymer Playground Server. At the end of
every week, a consolidated list of change request from each module will be submitted to the
Basis consultant to move the configuration to the Quality System Server Client 300.
Prior to system go-live for Quality Polymer, all the modules weekly change request will be
transported to the Production Server Client 300.
10 Training
Team Leader will conduct training for Quality Polymer Key Users throughout the life cycle of the
Rollout Implementation. The key users will be exposed to NPM live environment on their
respective module. A training plan will be draft out to ensure that different key users will have
allocated slot to sit with NPM users for some SAP hands-on transaction. This approach aims to
empower key users to take
NPM team leader will review the training materials prepared during Project Cheetah. Team
leaders will train end-users during the Realization Phase using training material that has been
fine-tuned.
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11 Testing Approach
Testing covers the activities related to both scenarios and transactional testing on the system to
ensure that the configuration settings are right. The testing approach will include test planning,
conducting tests and documentation of the testing performed.
User acceptance tests (UAT) will be conducted in Realization stage. Upon successful testing of
the system, users are to sign-off that they are willing to accept the new set of configuration.
Quality Polymer key users will be responsible to perform the entire testing with the guidance of ea
consultants and NPM team leaders. Together with NPM team leaders, ea consultants will also
plan for the UAT. During the UAT, all test results will be recorded and verified by the testers and
team leaders.
Testing will cover identification of the following:
11.1
Test data
Test data
Core Business Scenarios data - A number of Nippon Paint core scenarios per
company will be identified for testing
Core Business Process data The core business processes not included in the
business scenarios item 1 above will be tested.
In testing, a big consideration will be given to the integration between SAP modules. The detailed
plan for UAT will be prepared during the Realization phase.
11.2
Users to perform the User Acceptance Test will be identified during the early part of the
Realization phase. The selected users have the responsibility of testing the system, recording the
results of these tests, confirming that the testing works and note the exceptions and finally signoff the system indicating acceptance of the system. Therefore the testing must be completed and
signed off by the testers.
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Appendices
A.
Functional Requirements
A.1
A.2
A.3
A.4
Production Planning
A.5
B.
B.1
B.2
B.3
B.4
Production Planning
B.5
C.
List of Reports
C.1
C.2
C.3
C.4
Production Planning
C.5
D.
List of Forms
D.1
D.2
D.3
D.4
Production Planning
D.5
E.
E.1
E.2
E.3
E.4
Production Planning
E.5
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