Inventory Management and Optimization in SAP ERP / Edition 1

by Elke Roettig

Overview

Avoid having too little or too much stock on hand with this guide to inventory management and optimization with SAP ERP! Start by managing the stock you have through replenishment, goods issue, goods receipt, and internal transfers. Then plan for and optimize your future by avoiding bottlenecks, setting lead times, using simulations, and more. Finally, evaluate your operations using standard reports, the MRP Monitor, and KPIs. Keep your stock levels just right!

Key Inventory ProcessesUnderstand essential business processes like good receipt, goods issue, internal stock transfer, reservations, and using materials documents. Then map these processes to their specific master data settings like service levels and lot size.

Planning and OptimizationLearn how the entire supply chain influences inventory planning, and jump into methods and tools for inventory optimization including SAP ERP Add-On tools for simulations and inventory cockpits.

Monitoring, Reporting, and AnalysisEmploy Logistics Information Systems methods to control and monitor inventory, use the MRP Monitor for inventory analysis, and calculate key indicators to measure inventory performance.

Highlights:

• Inventory management
• Inventory optimization
• Supply chain management
• Goods receipt/goods issue (GR/GI)
• Stock transfer
• SAP ERP Add-Ons
• Lot size
• Demand planning
• Material requirements planning (MRP)
• MRP Monitor
• Key performance indicators (KPIs)

Product Details

ISBN-13:	9781493213108
Publisher:	Rheinwerk Publishing, Inc.
Publication date:	03/24/2016
Edition description:	New Edition
Pages:	523
Product dimensions:	6.90(w) x 9.00(h) x (d)

About the Author

Elke Roettig works at bigbyte software systems, inc., a New York-based international management consulting firm that provides expertise to optimize and streamline SAP Supply Chain Management. In that role she has focused her efforts on supply chain optimization, working with various clients on an international basis and utilizing the SAP ERP Add-On tools.Elke has a degree in business administration from the Verwaltungs- und Wirtschafts-Akademie (VWA) in Stuttgart, Germany. Since 1994, she has worked as an SAP consultant, focusing on materials and inventory management. She has functioned as senior SAP functional consultant on full life-cycle SAP implementations for many clients in the US across a multitude of different industries (automotive, consumer products, manufacturing, printing and packaging, engineering, wholesale distribution, medical devices, mining, etc.) and has supported many implementations in additional roles. Her consulting experience includes working with different releases of the SAP ERP system as well as with the SAP Business Warehouse system.

Table of Contents

... Introduction ... 13



... Contents of This Book ... 32



... Who This Is Book For ... 32



... How This Book is Organized ... 33



1 ... Inventory Management Basics ... 35



1.1 ... Movement Type Concept ... 35

1.2 ... Document Principle ... 40

1.3 ... Common Inventory Types ... 44

1.4 ... Inventory Costs ... 52

1.5 ... Summary ... 64



2 ... Inventory Business Processes ... 65



2.1 ... Inbound Processes: Goods Receipts ... 66

2.2 ... Outbound Processes: Goods Issues ... 88

2.3 ... Internal Stock Transfer Processes ... 107

2.4 ... Reservations ... 130

2.5 ... Cancelling Material Documents ... 135

2.6 ... Printing Material Documents ... 139

2.7 ... Physical Inventory ... 144

2.8 ... Inventory Management Reporting ... 156

2.9 ... Summary ... 160



3 ... Master Data Settings ... 161



3.1 ... Service Level and Safety Stocks ... 161

3.2 ... Safety Time ... 174

3.3 ... Lot Sizes ... 175

3.4 ... MRP Types ... 191

3.5 ... Replenishment Lead Time ... 218

3.6 ... Summary ... 221



4 ... Planning Around Inventory ... 223



4.1 ... Setting an Inventory Strategy ... 223

4.2 ... Forecasting and Demand Planning ... 235

4.3 ... Materials Requirements Planning (MRP) ... 254

4.4 ... Production ... 288

4.5 ... Summary ... 308



5 ... Inventory Optimization and Tools ... 311



5.1 ... Inventory Optimization Initiatives ... 312

5.2 ... Using the SAP Add-On Tools for Simulation ... 351

5.3 ... Using the Inventory Controlling Cockpit Add-On Tool ... 381

5.4 ... Multi-Echelon Inventory Optimization ... 399

5.5 ... Summary ... 402



6 ... Controlling, Monitoring, and Reporting on Inventory ... 405



6.1 ... Standard SAP ERP Reports ... 406

6.2 ... Analysis in the Inventory Controlling System ... 417

6.3 ... Analyses Using the MRP Monitor ... 438

6.4 ... Inventory Reporting Methods for Accounting Purposes ... 446

6.5 ... Summary ... 448



7 ... Measuring Inventory Performance ... 451



7.1 ... Key Figures ... 451

7.2 ... Key Performance Indicators (KPIs) ... 485

7.3 ... Dual Classification in the Logistics Information System ... 497

7.4 ... Summary ... 498



... Conclusion ... 501



... Appendices ... 503



A ... Additional Resources ... 505



B ... The SAP Add-On Tools ... 507



C ... SAP Key Figures in the Logistics Information System ... 509



D ... The Author ... 513



... Index ... 515