Supply Chain Management with
Global Bike Company using ERP and SCM
Section 1A- Planning and Execution in SAP ERP
This is currently a self-contained short course on operations planning and execution in SAP ERP.
It is designed to familiarize the student with the basics of the MM and PP modules in SAP ERP.
Product
SAP ERP Release 6.0
Global Bike International
(GBI)
Level
Undergraduate
Intermediate
Focus
MM/PP
Version
2.0
Authors
Mark Springer
Nate Humann
Seth Clemons
MOTIVATION
PREREQUISITES
This course is specifically
designed to give students in
an operations planning and
control course exposure to the
MM and PP modules in SAP
ERP. It assumes knowledge
of these concepts but no prior
SAP knowledge.
Required Knowledge
o Basic knowledge of MRPII
concepts
Recommended Knowledge
o No additional knowledge
needed.
NOTES
This course uses the standard Global Bike
client; connectivity with SCM not
required.
II
TABLE
PAGE
INSTRUCTOR’S NOTE .................................................................................................. 1
NAVIGATION IN SAP ..................................................................................................... 2
MATERIAL MASTERS FOR FERTS, HALBS, AND ROHS ........................................... 8
BILLS OF MATERIAL AND ROUTINGS FOR PLANNING .......................................... 36
MASTER PLANNING IN SAP ...................................................................................... 75
DETAILED PLANNING IN SAP .................................................................................. 120
PURCHASING AND ACCOUNTING .......................................................................... 169
1
INSTRUCTOR’S NOTE
This file includes the materials for a very short course on planning in SAP using the MM and PP
modules. There are five modules to the course: each one was designed to be done in one to two
hours, but with increasing corrections and streamlining it now seems that most students complete
each module in half an hour or so after the presentation. Seth Clemons, a former student who
was involved in an SAP implementation at Arctic Cat before returning to school to complete his
degree, helped me write the first version of these labs several years ago. Following that, Nate
Humann, a former student and Manugistics consultant (sorry!) who returned to Western to work
as an instructor for a couple years, upgraded the labs to Brett Wagner’s Fitter Snacker data set.
More recently I moved them over to Global Bike.
The class I use these labs in started as a standard manufacturing planning and control class. I
still cover most of the standard topics, but I squeezed out a few of the more esoteric topics to
make room for the lab (no more Part-Period Balancing, etc.). Since this is not exclusively a lab
course, I have tried to maximize learning per lab. The repetition comes when students work on
their take-home project.
The organization is as follows:
Module 0: Introduction to logging on to SAP and Navigation.
Module 1: Master Data I: Material Masters
Module 2: Master Data II: BOMs and Routings
Module 3: Forecasting and Sales and Operations Planning
Module 4: Master Scheduling and Material Requirements Planning
Module 5: Purchasing and Financial Accounting
Project: A final project where students need to do a subset of the processes to plan production
and order parts.
2
Navigation in SAP
0.0 Overview
While navigating within SAP can be difficult to learn, the interface can be very efficient as you
gain more experience with the program. Before you begin working in SAP, it is recommended
that you review this navigation overview in earnest in order to acquaint yourself with the two
primary methods for navigating to a transaction: (1) The Easy Access Menu and (2) Transaction
Codes.
0.1 Logging on to SAP
Select the SAP Logon icon from the list of programs as shown below.
This brings up the first SAP logon screen. Select MOSCOW – ECC 6.0 and click on Log On.
2. Hit Log On
1. Select system
3
This brings up the second SAP logon screen. Enter the client and user name as shown by your
instructor. Note that ## stands for your two-digit dataset number. The initial password is
SAP4US. Select the green checkmark
or hit the enter key (henceforth referred to as “hit
<Enter>”).
1. Enter client
2. Enter username
3. Enter password
The first time you log in, this will bring up a new password dialog box (not shown). Make up
and enter your new password twice, and then hit <Enter>. BE SURE TO WRITE YOUR
PASSWORD DOWN, AS IF YOU FORGET IT I NEED TO HAVE CALIFORNIA IN CHICO
RESET IT. THERE MAY BE A DELAY OF A COUPLE DAYS AND YOU WILL NOT BE
ABLE TO COMPLETE LAB ASSIGNMENTS IN THIS TIME. PASSWORDS ARE CASESENSITIVE. So write down your password.
0.2 The Easy Access Menu
The Easy Access Menu is a robust, nested menu system that sorts transactions by functional area
and business process. Navigating through the Easy Access Menu is very similar to using the
Windows Explorer File Manager to find specific files on your computer. However, with the Easy
Access Menu, main folders and main subfolders are generally named according to a functional
area (e.g. Accounting > Financial Accounting or Logistics > Production) while additional
subfolders are named for a business process (e.g. Logistics > Production > Capacity planning).
4
Rather than showing an image of each Easy Access Menu path, the lab instructions for this
course will provide a menu path. A menu path is a text description of how to navigate to a
specific transaction within the Easy Access Menu.
0.3 Transaction codes
Another way to navigate in SAP is through transaction codes. Every transaction in the system
is given a code number, and the system allows you to enter these code numbers as another means
of going directly to a transaction. Transaction codes are widely used in industry and will be used
at select places throughout the labs this quarter.
Before you begin using transaction codes, you must first tell SAP to display these codes. Select
Settings from the Extras menu and make sure that Display technical names is checked. Then
close the settings screen by clicking on the green checkmark icon
.
1. Select Settings
2. Check Display
Technical Names
3. Select enter
5
Transaction codes (henceforth “t-code” for short) will then be displayed next to the name of the
transaction within the Easy Access Menu. Note below that MM03 is the t-code for displaying a material
master, while the rather long menu path is Logistics > Materials Management > Material Master >
Material > Display > Display Current.
6
A command can be executed either by double-clicking on the menu item or entering the t-code in
the command field and hitting the enter key. The command field is to the right of the green
checkmark.
Enter the t-code MM03 in the command field as shown below and hit <Enter>.
1. Enter MM03
2. Hit the <enter> key
0.4 Simple Navigation
This brings up the first screen of the display material transaction. Note the navigation icons at
the top of the screen.
The enter
icon does NOT save data; it accepts your input and takes “appropriate action.”
That action may be moving to the next screen, or retrieving and displaying additional
information on the same screen based on your input.
The save
icon, which here is grayed out, saves data you have entered into a screen. When it
is grayed out as it is here, there is no new data to save. It is important to note that the only way
to save data is to hit the save icon or answer “yes” when asked to save in a dialog. Hitting the
enter icon will not save data. This is a big and important difference between SAP and most
Windows applications.
The back
icon takes you back to the previous screen. Sometimes SAP will not let you use
the back icon when it requires further data to be entered. But generally you can use the back
icon to go back one screen.
7
The exit
icon can also be thought of as a “way back” icon. If you are several screens deep
into a transaction, it will jump back several screens to the “next level up.” It can be somewhat
non-intuitive what the “next level up” is, so this icon is somewhat unpredictable when used in a
new screen.
The cancel
icon cancels the current screen without saving. If you think you have made a
mistake that can’t easily be corrected, the safest thing is cancel the transaction by repeatedly
hitting the cancel icon until you are back in the Easy Access Menu.
The new session
icon opens a new window in the current client. It can be useful to have
multiple windows open to different commands, i.e. you could watch the impact on planned
inventory levels when you run MRP.
0.5 Displaying Transaction Codes
A convenient way to learn transaction codes is to enable their display from within a given
transaction. To show the t-codes, first click on the left-facing arrow
at the bottom
right of the SAP window. Then click on the icon that appears in that part of the screen
and select Transaction from the pop-up menu. The t-code for each
transaction will now appear at the bottom of each transaction.
1. Select
2. Select menu icon
3. Select Transaction
0.6 Exiting to the Easy Access Menu.
Hit
to exit to the Easy Access Menu. If you want to leave SAP, hit
again.
8
Material Masters for FERTs, HALBs, and ROHs
1.0 Materials Management Master Data
In lab 1, you will learn how to create and configure finished, semifinished, and raw materials for
the Global Bike Company. GBC has manufacturing and distribution facilities scattered across the
US and Germany, but we will be working exclusively with the main US Bike plant in Battle
Creek, Michigan.
We will be creating a new product family of Ridge Front bikes. The product family will at first
contain only two different versions of the Ridge Front: the Ridge Front Std (Part number FG0020-##) and the Ridge Front Komfort (Part number FG-0021-##). The ## refers to your data
set number. The two models are identical except that the Komfort is pricier and has a wider and
softer seat. Most of the master data for the components used in both bikes is already entered in
SAP, but we will have to enter new data for the end items (the bikes), the saddle assembly for the
Komfort, and the new Komfort seat.
1.1 Create the Ridge Front Std and Ridge Front Komfort Bikes (FERTS)
1.1.1 The first step in the production planning process is to create the materials (products) that must be
planned. Once you have identified the materials that must be created in the system, it is a good practice to
start by creating the finished good. This is accomplished using the Create Finished Product transaction.
Finished products are referred to as FERTS in SAP; FERT is a German acronym.
1.1.2 Navigate to the menu path below using the concepts that you learned in the navigation overview
section.

Logistics > Production > Master Data > Material Master > Material > Create (special) > Finished
Product
9
1.1.3 After you double-click the Finished Product transaction in the Easy Access Menu, the first screen
that you will be presented with is titled the Create Finished Product (Initial Screen). You need to specify
the material part number and industry sector for your new part. Perform the following activities at this
screen.
1. Enter FG-0020-##
2. Enter Retail
3. Select enter
10
1.1.4 The next screen that you will see is titled Select View(s). Here you will define which areas of the
material master that you would like to create for the Ridge Front Std. Think of “views” as “tabs” in a file
folder containing different types of data. For now, we want to enter data (and therefore select the views)
for Basic Data 1, MRP 1, MRP 2, MRP 3, and Work Scheduling. We’ll worry about some of the other
data later. Perform the actions shown below.
1. Select the requested views
2. Check Create views selected
3. Select enter
11
1.1.5 You will now be asked to specify what plant the new finished good will be made in. Follow the
instructions below at the Organizational Levels dialogue box.
1. Enter ##A1 for your plant
2. Select enter
12
1.1.6 Now we see the data entry screen for the new part. Note the different tabs for different views. On
the Basic Data 1 tab of the material master, complete the activities shown below to begin configuring
your material. Leave default entries unchanged if you are not requested to change them or remove them.
1. Enter Ridge Front Std ## as the
material description
2. Enter EA (each) as the base
unit of measure
3. Enter 0202 as the Material
Group
4. Enter 9 KG as the gross and
net weight of the bike
5. Select enter
13
1.1.7 You are automatically taken to the next view that you initially specified. Complete the activities
shown below to configure the MRP 1 tab for your new material.
1. Enter M1 for the
MRP Type
2. Enter 1 for the Planning
time fence
4. Enter EX for the Lot size
3. Enter 1## for the MRP
Controller
5. Enter 10 for the Minimum
Lot Size
6. Select enter
14
1.1.8 Continue configuring your new material by performing the following activities on the MRP 2 tab.
1. Enter E for Procurement
type
2. Enter 1 for the In-house
production time
3. Enter 1## for the
SchedMargin key
5. Select enter
4. Enter 100 for the Safety
Stock
15
1.1.9 Complete the configuration of the MRP tabs by performing the following activities on the MRP 3
tab.
1. Enter 10 for Strategy group
2. Enter 02 for Availability
check
3. Select enter
16
1.1.10 Complete the configuration of the Material Master for your new FERT by performing the
following activities.
1. Enter 1## for Production
scheduler
2. Enter 10 for Prod Sched.
Profile
3. Save your new material
17
1.1.11 Now create a FERT for the related product FG-0021-##, the Ridge Front Komfort. All settings
for the FG-0021-## are the same as for the Std (Standard) version EXCEPT the safety stock is only 50
units.
1.1.11 Summary: You have now created two new finished products in SAP ECC 6.0 that represent two
distinct models of the Ridge Front Bike. In the next exercise, you will create the semi-finished seat
assembly that is used to make the Ridge Front Standard.
18
1.2 ~ Create the Ridge Front Komfort Saddle Subassembly (HALB)
1.2.1 The Ridge Front Komfort differs from Ridge Front Std in that it has a cushier seat. Thus, the
saddle assembly, which includes the seat, is different between the two bikes. The Std saddle assembly
has already been entered in the system, but the Komfort saddle assembly must be created.
A slightly different transaction than the one covered in exercise 1.1 is used to create the material that
represents the saddle. Notice that the menu path is nearly identical to the previous transaction, with one
small exception. Semi-finished goods are referred to as HALBs in SAP.
1.2.2 Navigate to the menu path below using the concepts that you learned in the navigation overview
section.

Logistics > Production > Master Data > Material Master > Material > Create (special) >
Semifinished Product
1.2.3 The first screen that you will be presented with is titled Create Semifinished Product (Initial
Screen) . Perform the following activities at this screen.
1. Enter SF-0031-##
2. Enter Retail
3. Select enter
19
1.2.4 The next screen that you will see is titled Select View(s). As with the bikes, we want to enter data
(and therefore select the views) for Basic Data 1, MRP 1, MRP 2, MRP 3, and Work Scheduling.
1. Select the requested views
2. Check Create views selected
3. Select enter
1.2.5 Follow the instructions below at the Oranizational Levels dialogue box.
1. Enter ##A1 for your plant
2. Select enter
20
1.2.6 On the Basic Data 1 tab of the material master, complete the activities shown below to begin
configuring your material.
1. Enter Saddle – RF Komfort ## as
the material description
2. Enter EA (each) as the base
unit of measure
3. Enter 0202 as the Material
Group
4. Enter 1 KG as the gross and
net weight of the saddle
5. Select enter
21
1.2.7 Complete the activities shown below to configure the MRP 1 tab for your new material.
1. Enter PD for the
MRP Type
3. Enter EX for the Lot size
2. Enter 1## for the MRP
Controller
4. Enter 15 for the Minimum
Lot Size
5. Select enter
22
1.2.8 Continue configuring your new material by performing the following activities on the MRP 2 tab.
1. Enter E for Procurement
type
2. Enter 1 for the In-house
production time
3. Enter 1## for the
SchedMargin key
5. Select enter
4. Enter 30 for the Safety
Stock
23
1.2.9 Complete the configuration of the MRP tabs by performing the following activities on the MRP 3
tab.
1. Enter 10 for Strategy group
2. Enter 02 for Availability
check
3. Select enter
24
1.2.10 Complete the configuration of the Material Master for your new HALB by performing the
following activities.
1. Enter 1## for Production
scheduler
2. Enter 10 for Prod Sched.
Profile
3. Save your new material
1.2.11 Summary: You have now created a new finished product in SAP ECC 6.0 that represents the
Komfort Saddle semifinished component (subassembly). In the next exercise, you will create a raw
material that, when combined with other other raw materials, will be used to make the Komfort Saddle.
25
1.3 ~ Create the Komfort Seat raw material (ROH).
1.3.1 Now, you will use a third material master data transaction, the create Raw Material transaction.
Raw materials are referred to as ROHs in SAP.

Logistics > Production > Master Data > Material Master > Material > Create (special) > Raw
Material
1.3.2 The first screen that you will be presented with is titled Create Raw Material (Initial Screen) .
Perform the following activities at this screen.
1. Enter RM-0101-## as Material
2. Enter Retail
3. Select enter
26
1.3.3 You will use the same navigational steps for the Select Views(s) and Organization Levels
dialogue boxes that you used in exercises 1.1 and 1.2, with one minor exception being that you
will only need to create the Basic Data 1, MRP 1, MRP 2, and MRP 3 views of the material
master; no Work Scheduling view is needed (why is that?). At the Organizational Levels
dialogue box, you will enter your plant code, which is ##A1 (i.e. your Data Set Number + A1).
1.3.4 Configure the various views of the material master for the raw material according to the
information listed in the table below.
View
Field
Value
Basic Data 1
Description
Seat – RF Komfort ##
Base Unit of Measure
EA
Material Group
0202
Gross Weight
0.2
Net Weight
0.2
Weight Unit
KG
Purchasing Group
##A
Mrp Type
PD
MRP Controller
1##
Lot Size
EX
Minimum Lot Size
250
Plnd Delivery Time
3
Sched Margin Key
1##
Safety Stock
75
Availability Check
02
Period Indicator
M
MRP 1
MRP 2
MRP 3
27
1.3.5 Be careful to Save your settings after creating the new material. If you are unsure how to
save, refer back to exercises 1.1 and/or 1.2
1.3.6 Summary: You have now created a new raw material that will be used in the production
of the RFK Saddle and ultimately in the production of the RFK bike.
28
1.4 ~ Change Material Master Data
1.4.1 A co-worker just stopped by your desk. Apparently, while reviewing the department TPS report,
they noticed that you had an incorrect setting on one of your new raw materials. It seems that you have
inadvertently defined a fixed lot size of 2500 for the RFK seat raw material. This setting should actually
be 250.
1.4.2 You will use the Change Material Immediately transaction to make this change.

Logistics > Production > Master Data > Material Master > Material > Change > Immediately
1.4.3 The initial screen will indicate that this is a Change transaction as opposed to a Create transaction.
Perform the following activities at this screen to begin making changes to the seat.
1. Enter RM-0101-##
2. Select Select views
29
1.4.4 By referring back to the table in the previous exercise, you can see that the Minimum lot size
setting is defined on the MRP 1 view of the material master. If there were other tabs of the material
master that you wanted to review, you would select them at the Select View(s) screen. In this case, it is
only necessary to select the MRP 1 view.
1. Select the requested views
2. Select enter
1.4.5 You will use the same plant at the Organizational Levels dialogue box that you used in
previous exercises. This is plant ##A1.
1.4.6 Locate the Fixed lot size setting of 2500 at the next screen. Change it to 250 and click on
the Save icon (the disk icon in the top toolbar that you used in previous exercises.)
1.4.7 Summary: You have now modified a material master data setting for the RFK - Seat
material. If you were required to make further changes to master data for Soy Protein, or for
other products, you would do so in the same manner.
30
1.5 ~ View Material Master Data
1.5.1 Now, let's interpret some of the parameters that you defined during the creation of your materials.
To accomplish this, you will use a fifth transaction, the Display Material transaction.

Logistics > Production > Master Data > Material Master > Material > Display > Display current
1.5.2 The initial screen will indicate that this is a Display transaction as opposed to a Create or Change
transaction. Let's assume at this point that you do not know the material codes for the products listed on
your question sheet. It is possible to search for materials in SAP using the instructions shown in the
following screenshots.
1. Click in the Material field
2. Click on search icon
31
1.5.3 The next screen that you are presented with asks you to enter a Material description.
Here you will search for materials that include your Data Set Number (DSN). If you refer back
to exercises 1.1 and 1.2, you will recall that the materials you have created all had code that
ended with your DSN. This allows you to easily search for those materials that belong to you.
Notice that the screenshot below indicates that you should enter an asterisk sign (*), a dash,
another asterisk, a dash, and then your DSN. This asterisk is a wild card that stands for any text
or number combination. This tells SAP that you would like to see a list of all of the materials that
contain your DSN in the material code.
1. Enter *-*-## for Material
2. Click on enter to search
32
1.5.4 After selecting the green checkmark at the screen shown above, you will be presented with a list of
all of the materials in SAP that end with your DSN (your list may have more materials on it than the one
shown below). Double-click on the entry for the RFK bike.
1. Double click on RFK ##
33
1.5.5 This now enters the material number for the RFK ## bike into the Material field of the
Display Material screen. Click on Select views to begin the transaction.
1. Select Select views
34
1.5.6 When prompted to Select View(s) of the material master, select the Basic Data 1, MRP 1,
MRP 2, MRP 3 and Work Scheduling views. Click on enter to proceed to the next screen. When
prompted for the plant code, remember that your plant code is ##A1 at the Organizational
Levels dialogue box. Click on enter to proceed to the data tabs.
1.5.7 As you page through the tabs on the material masters for the products listed on your
answer sheet, you can investigate specific settings using the Search icon instructions shown
below. For example, investigate on MRP 1 what the possible lot-sizing rules are. How would
an EOQ or POQ rule be implemented?
1. Place cursor in field
2. Click on search icon to bring up a
dialog box with possible values for
the field.
35
1.5.8 Another approach to investigating field settings is to place your cursor in the field as you did in step
1.5.7 and hit the [F1] key on your keyboard.
1.5.9 Summary: You have now learned the transactions and transaction codes used to create
three different material types, to change the material master settings of a material, and to view
the material master settings of a material.
36
Bills of Material and Routings for Planning
2.0 Production Planning Master Data
In lab 2, you will learn how to create and configure bills of material and routings. You will also
learn how to use the SAP Help Library to gain further understanding of the concepts related to
bills of material and routings.
The Global Bike Company plans on using only one workcenter to produce the two Ridge Front
models. This workcenter is the assembly workcenter, and it is used for final assembly as well as
for making subassemblies.
The main lab objectives are for you to further your familiarization with the basic navigational
concepts within SAP and to consider how this production configuration might affect the actual
production and material plans of the two Ridge Front models.
2.1 ~ Create a Bill of Material for FG-0021-##
2.1.1 A critical input to the MRP process is the Bill of Materials (BOM), which describes the relationship
between a finished product and all of its raw material components and subassemblies. It is the recipe that
defines what number and combination of parts are required to manufacture a parent product.
2.1.2 The BOM for the Ridge Front Komfort will be created using the Create Material BOM
transaction shown below.

Logistics > Production > Master Data > Bills of Material > Bill of Material > Material BOM >
Create
37
2.1.3 Once you execute the Create BOM transaction, you will be presented with the following Initial
Screen. Perform the following activities at this screen.
1. Enter FG-0021-##
2. Enter ##A1 for Plant
3. Enter 1 for BOM Usage
4. Select enter
38
2.1.4 There are many ROHs and HALBs that must be assembled to make a single FG-0021-##. You will
enter one line-item for each of these components at the General Item Overview screen. For each
component, you must enter the code L for the Item Category, the component part number, and the number
of units each component needed to make one unit of the parent part (the FG-0021-## bike). USE THE
MOUSE TO MOVE BETWEEN FIELDS. DO NOT HIT ENTER UNTIL YOU HAVE ENTERED ALL
OF THE DATA SHOWN BELOW.
1. Enter L as the ICt for
each component
4. AFTER all seven rows of data are
entered, hit enter
2. Enter the component
numbers as shown for
each component
3. Enter the quantity needed of
each component
39
2.1.5 Note that SAP retrieved the component descriptions and units of measurement from the material
masters for each part. Now save your BOM.
1. Save your data.
40
2.1.6 Now create and save a BOM for the finished good FG-0020-##, the Ridge Front Std bike. The
BOM is the same as for the FG-0021-##, EXCEPT that instead of component SF-0031-## for the saddle,
you use SF-0030-##.
41
2.2 ~ Create a Bill of Material for the Saddle Semi-finished Good
2.2.1 The BOMs we created in 2.1 were single-level BOMs; they just showed what components
were needed to make the finished products and did not list the components needed to make the
(higher-level) components that go into the finished products. Most of these lower-level singlelevel BOMs have already been created, but you will now need to create a bill of material that
defines the relationship between the RFK Saddle and its component raw materials.
2.2.2 The BOM for the RFK Saddle will be created using the same Create Material BOM
transaction used in exercise 2.1. However, you will start this transaction using the transaction
code that you recorded rather than using a menu path for the Easy Access Menu. Remember, a
transaction code is a unique code that corresponds to a transaction in SAP; it is not the same
thing as a material code.
1. Enter CS01 for transaction code
2. Hit enter
42
2.2.3 Once you execute the Create BOM transaction, you will be presented with the following Initial
Screen. Perform the following activities at this screen.
1. Enter SF-0031-##
2. Enter ##A1 for Plant
3. Enter 1 for BOM Usage
4. Select enter
43
2.2.4 You will enter three total line-items for the raw materials that make up the RFK saddle. You will
enter one line-item for each of these components at the General Item Overview screen. For each
component, you must enter the code L for the Item Category, the component part number, and the number
of units each component needed to make one unit of the parent part (the FG-0031-## saddle). USE THE
MOUSE TO MOVE BETWEEN FIELDS. DO NOT HIT ENTER UNTIL YOU HAVE ENTERED ALL
OF THE DATA SHOWN BELOW.
1. Enter L as the ICt for
each component
4. AFTER all three rows of data are
entered, hit enter
2. Enter the component
numbers as shown for
each component
3. Enter the quantity needed of
each component
44
2.2.5 Note that SAP retrieved the component descriptions and units of measurement from the material
masters for each part. Now save your BOM.
1. Save your data.
2.2.6 Summary: You have now created a bill of material that establishes the relationship between the
RFK bike and the RFK saddle subassembly. You don’t need to create a BOM for the RF-Std saddle,
since it already exists.
45
2.3 ~ Explode (View) the Bill of Material
2.3.1 To confirm that you have configured your RFK bike and RFK saddle assembly bills of material
properly, you will use the Explode Multilevel BOM transaction. This transaction allows you to see a
listing of all of the raw materials and subassemblies required to produce the bike. The bill of materials
will be displayed in indented format as opposed to the product structure tree format, with which you
may be more familiar.
2.3.2 You will explode the NRG-C multilevel BOM using the transaction shown below.

Logistics > Production > Master Data > Bills of Material > Reporting > BOM Explosion >
Material BOM > Multilevel BOM
2.3.3 Once you execute the Explode transaction, you will be presented with the following Initial Screen,
where you must enter information for your RFK bike. Take extra care to verify that the material code for
the RFK bike is entered at the prompt as the RFK saddle subassembly material code may carry over from
the last transaction.
1. Enter FG-0021-## for Material
2. Enter ##A1 for Plant
3. Enter PP01 for BOM
Application
4. Select execute icon
46
2.3.4 The Display Multilevel BOM that appears next is in indented format as opposed to the product
structure tree format. Take a few moments to review the indented BOM and visualize how it might look
as a product structure tree. Notice that the other subassemblies (front and rear wheels, handle bars, etc.)
have already been entered in the system. Basically, our RFK is using some pre-existing subassemblies in
its design and manufacture.
1. The RFK is at level 0
2. The base quantity is how many bikes
are made with all the components in the
BOM
3. The level for each component is
displayed in the left-hand column
2.3.5 Summary: The Explode BOM transaction allows you to view the overall indented BOM for a
product that is comprised of multiple single-level BOMs.
47
2.4 ~ Create a Routing for the RFK Bike
2.4.1 A routing defines the operations and workcenters required to manufacture a product. It also
specifies the allocation of components to those operations.
2.4.2 The menu path for the Create Routing transaction is shown below.


Logistics > Production > Master Data > Routings > Routings > Standard Routings > Create
Make note of the transaction code
2.4.3 Perform the following activities at the Initial Screen.
1. Enter FG-0021-## for Material
2. Enter ##A1 for Plant
3. Select enter
48
2.4.4 Enter the following information at the Header Details screen.
1. Enter 1 for Usage
2. Enter 4 for Status
3. Select Operations
49
2.4.5 You now must enter all the distinct operations needed to assemble the RFK bike from its
components. Note that there are five operations, each of which takes place in workcenter ##WC1. You
will have to three field entries for each operation. Enter the information shown below. BE SURE TO
USE THE MOUSE TO MOVE THE CURSOR BETWEEN FIELDS. DO NOT HIT RETURN TO
MOVE BETWEEN FIELDS.
1. Enter ##WC1 for each
Work center
3. Enter the appropriate entry for each
Description
2. Enter ASSY for each
Control key
4. Select enter
50
2.4.6 You must now enter the setup time for the first operation.
1. Enter 3
2. Select enter
51
2.4.7 You must now enter the per unit labor time for the first operation.
1. Enter 9
2. Select enter
52
2.4.8 Somewhat tediously, SAP will step you through entering the setup and per unit labor times for each
of the remaining four operations. Proceed in the same manner as described above in 2.4.6 through 2.4.9.
The values for setup and per unit labor times are given below:
Operation Setup Labor
20
4
6
30
3
5
40
3
4
50
2
9
2.4.9 After entering all the numbers you will be taken back to the Create Routing Operation Overview
screen. You can scroll over to check your setup and labor entries.
1. Scroll to the right to
check entries
53
2.4.10 Now we must specify what parts are needed for each operation. Select the CompAlloc
(component allocation) button.
1. Select CompAlloc button
54
2.4.11 Since for operation 10 we are attaching the wheels to the frame, we need to specify that the parts
from the BOM we need are the wheels and the frame. Perform this activity by following the instructions
below.
1. Select the wheels and
frame components
2. Select new assignment
2.4.12 This brings up the dialog box below. Confirm that these parts are required at operation 10.
1. Enter 10 for operation
2. Select enter
55
2.4.13 Note how the assigned parts now turn blue to indicate we have specified in which operation they
will be assigned. We next assign needed parts to operation 20 next by following the steps below.
1. Select the saddle
2. Select new assignment
2.4.14 This brings up the dialog box below. Confirm that these parts are required at operation 20.
1. Enter 20 for operation
2. Select enter
56
2.4.15 We assign needed parts to operation 30 next by following the steps below.
1. Select the handle bars
2. Select new assignment
2.4.16 This brings up the dialog box below. Confirm that these parts are required at operation 30.
1. Enter 30 for operation
2. Select enter
57
2.4.17 We assign needed parts to operation 40 next by following the steps below.
1. Select the pedals
2. Select new assignment
2.4.18 This brings up the dialog box below. Confirm that these parts are required at operation 40.
1. Enter 40 for operation
2. Select enter
58
2.4.19 We assign needed parts to operation 50 next by following the steps below.
1. Select the break kits
2. Select new assignment
2.4.20This brings up the dialog box below. Confirm that these parts are required at operation 50.
1. Enter 50 for operation
2. Select enter
59
2.4.21 Save your completed routing.
1.Save
60
2.4.22 Create an identical routing for FG-0020-##, the standard RF. Make sure that group number is
blank.
1. Enter FG-0020-## for Material
2. Enter ##A1 for Plant
3. Make sure Group is blank
4. Select enter
2.4.23 Go through same steps as you did to create the routing for FG-0021-##. All setup and run times
are the same. The only difference is that there is a different subassembly for the saddle in the saddle
attach operation. The subassembly is SF-0030-## instead of SF-0031-##.
2.4.24 Summary: Routings have now been created for the RFK and the RF Std bike.
61
2.5 ~ Create a Routing for RFK saddle subassembly
2.5.1 This exercise is nearly identical to the previous exercise, however, you are now creating a
routing for the RFK saddle subassembly material instead of the RFK bike finished good.
2.5.2 Refer to the transaction code that you recorded on your for the previous exercise. Enter
this code in the Command Field as shown below.
1. Enter transaction code for create
routing
2. Select enter
62
2.5.3 Perform the following activities at the Initial Screen.
1. Enter SF-0031-## for Material
2. Enter ##A1 for Plant
3. Make sure Group is blank
4. Select enter
63
2.5.4 Enter the following information at the Header Details screen.
1. Enter 1 for Usage
2. Enter 4 for Status
3. Select Operations
64
2.5.5 You now must enter all the distinct operations needed to assemble the RFK saddle subassembly
from its components. Note that there is only one operation, which takes place in workcenter ##WC1.
Enter the information shown below. BE SURE TO USE THE MOUSE TO MOVE THE CURSOR
BETWEEN FIELDS. DO NOT HIT RETURN TO MOVE BETWEEN FIELDS.
1. Enter ##WC1 for each
Work center
3. Enter the appropriate entry for each
Description
2. Enter ASSY for each
Control key
4. Select enter
65
2.5.6 You must now enter the setup time for the first operation.
1. Enter 2
2. Select enter
66
2.5.7 You must now enter the per unit labor time for the first operation.
1. Enter 5
2. Select enter
67
2.5.8 Now we must specify what parts are needed for each operation. Select the CompAlloc (component
allocation) button.
1. Select CompAlloc button
68
2.5.9 Here you are assigning all of the raw material components to operation 0010, which is the saddle
assembly operation you just created.
1. Select all components
2. Select New assignment
2.5.10 This brings up the dialog box below. Confirm that these parts are required at operation 10.
1. Enter 10 for operation
2. Select enter
69
2.5.11 Save your completed routing.
1.Save
2.5.13 Summary: A routing has now been created for RFK saddle subassembly. All of the raw materials
that the RFK saddle subassembly is comprised of have been assigned to this operation.
70
2.6 ~ Use the SAP Help Library
2.6.1 The SAP Help Library is a useful tool for learning more about the different areas of
configuration and transactions in SAP R/3. The SAP Library is available from the help menu
from within most transactions and from the Easy Access Menu.
2.6.2 Pull up the SAP Help Library using the instructions below.
1.Select SAP Library from
the Help menu
71
2.6.3 The menu system for the library is structured in the same manner as the Easy Access
Menu, where help file entries are sorted by functional area and process. Expand the ERP
Central Component (ECC) help area as shown below.
1.Select SAP ERP Central
Component
72
2.6.4 Follow the instructions below to expand the Production Planning and Control help area.
1.Expand Logistics
2. Select Production
Planning and Control
73
2.6.5 Review the help file information on bills of material using the following instructions.
1. Expand Basic Data
2. Select BOMS
74
2.6.6 Note the large amount of information on how BOMs are created and used in SAP.
2.6.7 Summary: The SAP Help Library is a valuable resource for learning more about system
configuration and transactions.
75
Master Planning in SAP
3.0 Forecasting, Aggregate Production Planning, Master Production Scheduling
The phrase “master planning” is sometimes used to cover both big-picture aggregate production
planning and master production planning. In lab 3, you will learn how to develop a forecast for a
product group, create an aggregate production plan, and disaggregate this production plan to
form a basis for the master production schedule. You will also be introduced to the
stock/requirements List, which is an invaluable transaction for diagnosing your plan in SAP.
As you may have gleaned from the labs thus far, each lab builds on data created in the previous
lab. If you have not yet finished creating your master data from labs 1 and 2, you will not be
able to begin this lab.
3.1 Create historical data for RFS and RFK bikes.
3.1.1 Since both bikes are make-to-stock, we need forecasts as a basis for planning. To make forecasts,
we need historical data. Normally we would use past sales data already in the system, but since we just
entered the product data we will have to enter the historical sales data for the two bikes manually.
3.1.2 We enter this data in the material master. We already created material masters for the RFS and
RFD, but we need to add additional views. This is referred to as extending the material master, and to do
so we use the same Create Finished Product transaction we did in 1.1.

Logistics > Production > Master Data > Material Master > Material > Create (special) > Finished
Product
76
3.1.3 Perform the following activities at this screen.
1. Enter FG-0021-##
2. Enter Retail
3. Select Select views
77
3.1.4 We are going to add the Forecasting view. To do this, we first de-select all views and then select
the Forecasting View. Perform the following activities at this screen.
1. Deselect all views
2. Select Forecasting
3. Select enter
78
3.1.5 You will now be asked to specify what plant the new finished good will be made in. Follow the
instructions below at the Organizational Levels dialogue box.
1. Enter ##A1 for your plant
2. Select enter
79
3.1.6 The Forecasting view is shown.
Perform the following activities.
1. Select Consumption vals
80
3.1.7 The Consumption view is shown.
1. Select Total consumption
Perform the following activities.
81
3.1.8 The Consumption view is shown as below. You will enter historical sales data in the Total
consumption column. Start with the most recent period (02/2009 in the image below, but it will differ on
your screen) and enter three years worth of past data (thirty-six periods). Again, your exact numbers will
differ from those below since the dates will differ.
1. Start entering data here
2. Enter 36 periods of data (see below)
3. Select Save
4. Select Main data
82
Use the following data, starting with the month shown for the current year, and working back thirty-six
periods.
Year
Periods
Current Year
Current Year 1
Current Year –
2
Current Year 3
12
113
93
83
73
11
103
83
73
63
10
105
85
75
65
9
112
92
82
72
8
105
85
75
65
7
98
78
68
58
6
95
75
65
55
5
105
85
75
65
4
100
80
70
60
3
100
80
70
60
2
102
82
72
62
1
109
89
79
69
83
3.1.9 The Forecasting main data view returns. Perform the following activities to specify that you want to
use an exponential-smoothing based forecasting model with trend and seasonality. Note that we are using
a “seasonal trend model” which has smoothing parameters for trend (Beta) and seasonality (Gamma) as
well as base level (Alpha).
1. Enter X for Forecast model
2. Enter M for Period Indicator
3. Enter 60 for Hist. Periods
4. Enter 12 for Forecast Periods
5. Enter 12 for Periods per season
6. Enter 12 for Initialization pds
7. Enter X for Initialization
8. Enter F for Optimization Level
9. Enter 0.20 for Alpha; 0.10 for Beta; 0.30
for Gamma; 0.30 for Delta
10. Uncheck Reset automatically
11. Check Param. optimization
12. Select Save
84
3.1.10 Using exactly the same technique as in 3.1.2 though 3.1.8, create the forecast for FG-0020-##
using the historical sales data below. Use the same forecasting values for the main data as in 3.1.8.
Year
Periods
Current
Year
Current
Year – 1
Current
Year - 2
Current
Year – 3
12
48
43
38
33
11
38
33
28
23
10
40
35
30
25
9
47
42
37
32
8
40
35
30
25
7
33
28
23
18
6
30
25
20
15
5
40
35
30
25
4
35
30
25
20
3
35
30
25
20
2
37
32
27
22
1
44
39
34
29
3.1.10 Summary. We have entered three years of historical data for our two make-to-stock bikes.
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3.2 ~ Create a Product Group
3.2.1 We want our first “big picture” plan to be an aggregate production plan for the Ridge Front bike
family. We must therefore define this product family, or product group. A Product Group defines the
relationship between a group or family of products and must be created before you begin the forecasting
process. This small bike family is comprised of the RFS and RFK bikes.
3.2.2 Create a Product Group using the menu path below.

Logistics > Production > SOP > Product Group > Create
3.2.3 Perform the following activities at the Initial Screen.
1. Enter ## RF Bike Group for Product group
2. Enter description of product group
3. Enter ##A1 for Plant
4. Enter EA for Base Unit
5. Select enter
86
3.2.4 We expect sales, and therefore production, of Standard and Komfort models to be split 25%-75%.
Therefore, enter the member (product) information of the Product Group as shown.
1. Enter members as shown
2. Enter Aggr. Fact. and proportion
3. Select enter
4. Select Save
3.2.5 If you did not return to the Easy Access Menu after saving, hit the [Exit] icon now so that you may
navigate to the next transaction.
87
3.3 ~ Forecast Sales for a Product Group
3.3.1 Now that you have a Product Group, you can begin the forecasting process in the
Planning Table using the transaction shown below.

Logistics > Production > SOP > Planning > For Product Group> Change
3.3.2 Enter your product group at the Initial Screen. Make sure to edit the Active version of
the plan.
1. Enter ## RF Bike Group as
Product group
2. Enter ##A1 as Plant
3. Select Active version
88
3.3.3 This brings up the planning table for the ## RF Bike product family. Note that the table is titled
“Change Rough-Cut Plan,” even though this is not what APICS would consider a rough-cut capacity plan
(which is based on the MPS). Unfortunately, SAP does not always use the “standard” APICS
terminology, so it’s always important to understand what the transaction does and not just rely on the
formal screen title. What we are going to do is come up with a simple sales and operations plan. We will
forecast sales for the product group and then come up with a production plan.
89
3.3.4 Start the forecasting process using the menu path shown.
1. Select Forecast from the
Edit > Create sales plan
menu
90
3.3.5 Enter the period intervals for the Forecast and Historical data as specified below (we want to
forecast for the next twelve periods--starting next month--based on the last thirty-six periods—not
including this month, which isn’t over). Make sure to select the automatic model selection for your
forecast.
1. Enter next month, this year
2. Enter this month, next year
3. Enter next month, 3 years
back
4. Enter last month, this year
5. Select Aut. model selection
6. Select Forecasting
91
3.3.6 We already entered our parameter values, so we just need to specify that we want to check for trend
and seasonality.
1. Trend and season
2. Select Forecasting
92
3.3.7 Your forecast WILL differ from those below. Note that the process calculated the forecast for this
month (month 2/2009 in the example below), but since we are already partway through this month we are
not going to include a forecast for this month in our sales plan. Notice it calculates MAD for the last
year; our forecast looks pretty good. Again, your exact numbers will differ since the dates will differ.
But let’s look at a graphical representation. Perform the actions specified below.
1. Select Graphics icon
93
3.3.8 Two windows will open. Select the window titled “SAP Statistics Graphics.” The vertical blue line
represents today. The history is shown in yellow while the future forecast is shown in red. First, note
that this is showing sales and forecast for the RF bike family; the sales are the sum of historical sales for
RFS and RFK. Second, note that for the previous year, a forecast was calculated and compared to the
historical sales data; this is where the MAD calculation comes from. Finally, the red/orange line going
into the future is next year’s product family forecast. After reviewing the forecast, close the graphics
screen. The other graphics screen will close automatcally.
1. Close graphics screen
94
3.3.9 Commit your sales forecast to the planning table as shown below. Again, your exact numbers will
differ since the dates will differ.
1. Select enter
95
3.3.10 Note that the forecast is entered in the Sales row. Your exact numbers will differ since the dates
will differ. Save your new forecast.
1. Select Save
3.3.11 Summary: You have now created a sales forecast for the RF product group at the Global Bike
Company. You will create an aggregate production plan to fulfill this forecast in the next exercise.
96
3.4 ~ Aggregate Planning
3.4.1 In the previous exercise, you created a forecast to populate the sales row of the planning
table. Now, you will use 3 techniques to create a production plan to populate the production
row of the planning table. If you are not still in the Change SOP transaction, reenter it:

Logistics > Production > SOP > Planning > For Product Group> Change
3.4.2 Enter your product group at the Initial Screen. Make sure to edit the Active version of
the plan.
1. Enter ## RF Bike Group as
Product group
2. Enter ##A1 as Plant
3. Select Active version
97
3.4.3 Your planning table appears with the sales forecasts you created. Your exact numbers will differ
since the dates will differ. You will use the navigational arrows shown below in order to display every
period with demand in the next few exercises.
1. These arrows are used to
view future and past time
periods
98
3.4.4 Begin by creating a production plan that is Synchronous to sales. Note how the Production row
is populated after selecting the Synchronous to sales option. Your exact numbers will differ since the
dates will differ.
1. Select Sychronous to sales
from the Edit > Create
producn plan menu
2. Note that the resulting
production plan is basically a
chase plan.
99
3.4.5 Now, you will create a different production plan that targets a static stock level of twenty-five units.
That is, it will make sure that there is a minimum inventory level on hand at the end of each period.
Again, note the resulting calculation of the Production row and the Day’s supply row. The Day’s
supply row shows how many days of demand can be covered by the ending inventory given the month’s
demand. Your exact numbers will differ since the dates will differ.
1. Enter a target stock level of 25 units for
each period that has demand (12 periods).
You will need to scroll to the right to make
all entries
2. Select Target stock level
from the Edit > Create
productn plan menu
100
3.4.6 Finally, you will create yet another (final) production plan by targeting the days supply of inventory
on hand. We want to plan on having seven days of finished goods inventory on hand all year. Your exact
numbers will differ since the dates will differ.
1. Enter a target day’s supply of 7 days for
each period that has demand (12 periods).
You will need to scroll to the right to make
all entries
2. Select Target day’s supply from
the Edit > Create productn plan
menu
101
3.4.7 Let’s take a quick look at the sales and operations plan graphically. Follow the instructions below.
1. Select graphics Characteristic
102
3.4.8 Three windows will open. Select the SAP Statistics Graphics window. Note that production, the
blue line, is tracking sales, the white line, pretty closely. Close the window and all three graphics
windows will close.
1. Close graphics window.
103
3.4.9 Save your final plan.
1. Select Save
3.4.10 Summary: You have now learned 3 basic methods for calculating a production plan in SAP. The
objective of the next exercise is to disaggregate this aggregate production plan by time and by product.
104
3.5 ~ Disaggregate the Aggregate Production Plan
3.5.1 An aggregate production plan is generally expressed in monthly buckets (time periods)
over an 18 month horizon. The production plan must be translated into a weekly master
production schedule (MPS) to link the planning and manufacturing functions. The master
production schedule is an input to capacity planning and it drives the material requirements
(MRP). If you are not still in the Change SOP transaction, reenter it:

Logistics > Production > SOP > Planning > For Product Group> Change
3.5.2 Enter your product group at the Initial Screen. Make sure to edit the Active version of
the plan.
1. Enter ## RF Bike Group as
Product group
2. Enter ##A1 as Plant
3. Select Active version
105
3.5.3 Disaggregate the production plan by time into weeks.
1. Select weeks from the Edit
> Period splitting > Total
menu
106
3.5.4 Note that the time buckets are now weekly, not monthly. “09/2009” now stands for the ninth week
of 2009. Your exact numbers will differ since the dates will differ. Make sure to save your
disaggregated plan.
1. Select Save
107
3.5.5 A new transaction will be used to disaggregate your plan by product and transfer the
demand information to planning.

Logistics > Production > SOP > Planning > For Product Group> Transfer Product Group to
Planning
3.5.6 A new transaction will be used to disaggregate your plan by product and transfer the
demand information to planning.
1. Enter ## RF Bike Group for Product group
2. Enter ##A1 for Plant
3. Enter A00 for Version
4. Select this option. The plan will be split using the
proportions that defined the product group
5. Uncheck Invisible transfer
6. Select Transfer now
108
3.5.7 You will be prompted to save the demand information for each of the two products in the
product group. First, you see the weekly disaggregated plan for the RFS. Your exact numbers
will differ since the dates will differ. Save the plan.
1. Select Save
109
3.5.8 Next, save the plan for the RFK. Your exact numbers will differ since the dates will differ.
1. Select Save
3.5.9 Summary: You have now disaggregated the aggregate production plan for the Ridge Front group
of products. Exit and return to the Easy Access Menu.
110
3.6 ~ The Stock/Requirements List
3.6.1 The Stock/Requirements List is your one-stop-shop for diagnosing the time-phased
projection of supply and demand for a given product. It is a forward looking tool that shows the
timing and quantity of customer requirements for a given product along with the current
production schedule to meet those requirements.
3.6.2 The S/R List is commonly used to evaluate the results of the MPS and MRP processes.
You will see in this example how the master schedule that you previously created has placed
independent requirements (IndReq) against the RFK bike at your plant location. Begin using the
transaction by following the menu path below.

Logistics > Production > MRP > Evaluations > Stock/Requirements List
3.6.3 You can pull up your products in many different ways. Let's start by using the Collective
access method for viewing your products.
3.6.4 Enter your product group information as shown below.
1. Select Collective access
2. ##A1 for Plant
3. Enter ## RF Bike Group for
Product group
4. Select enter
111
3.6.6 We get a list of the two products in the product group. Note the red traffic light next to each. This
is a message to the planner that the plan for that part needs attention. Click on the traffic light for FG0021-## to see the problem.
1. Select traffic light
3.6.7 Apparently, we have negative days’ supply of the product. The traffic light is set up to flash red
when the day’s supply drops below -0.1. Basically, we have no production scheduled but we have
demand, so this is not a big surprise. Close the information box.
1. Select enter
112
3.6.8 There is a lot of summarized information in this overview list to help the planner spot problems.
The columns numbered “1” through “8” are types of exception messages. Note that exception message
type/group 6 has one message. Place the cursor in that cell for material FG-0021-## and then click on the
find icon to see what type of problem that might be.
1. Place cursor in cell and click on
find icon
113
3.6.9 A popup box lists all groups of exception messages, and the possible exception messages in each
group. Note that group 6 (where we had one exception message) seems to do with inventory levels—
something we know we have a problem with. Close the popup screen.
1 Close screen.
114
3.6.10 Now look at the details for each product. Follow the instructions below to review the
Stock/Requirements Lists for both bikes.
1. Select both products
2. Select Selected
stock/requirements lists
115
3.6.11 Carefully review the Stock/Requirements Lists for each products. Your exact numbers will differ
since the dates will differ. Use the [back] and [forward] arrows as necessary to compare the screens.
Note that for product FG-0021-92 below, there is an independent requirement (demand) on 02/23/2009
for 3 units, which leaves the projected available balance at that point in time at -53. Also note that our
requirement for a safety stock of 50 units has generated a demand for 50 units immediately. Also, the
exception message of 96, if we were to look it up in the table shown in 3.5.7, confirms that we are below
our safety stock. Note also that our planning time fence goes out one day into the future.
1. Navigate to different S/R lists
for both products
2. Date and type of supply or
demand
3. Amount of supply or demand
4. Projected available balance
5. Exception message code
6. End of planning time fence
116
3.6.12 Unlike the material planning records we saw in class, the default SAP S/R list is shown in a
continuous time event-based format: every demand element/order is shown separately with its
corresponding date. If we want to group demand and supply orders into weekly or daily time buckets, as
in class, we can do that. Perform the activity shown below.
1. Select Period Totals icon
117
3.6.13 This brings up the Period Totals views. Select weeks to see weekly time buckets.
1. Select Weeks view
118
3.6.14 This looks a little more like the planning records we saw in class, although it reads from top to
bottom rather than left to right. Select the puzzle icon to go back to the detailed view.
1. Weekly time period
2. Demand for week
3. Supply for week
6. Select puzzle icon to return to
detail
4. Projected available
quantity
5. ATP is zero since
there is no inventory and
no planned production
119
3.6.15 Summary: You have now reviewed how the independent requirements appear in the
Stock/Requirements List. In lab 4, you will run the MPS and MRP processes to create elements of supply
to fulfill this demand.
120
Detailed Planning in SAP
4.0 Material and Capacity Requirements Planning
In lab 4, you will learn how to run the MPS and MRP processes to create planned orders, how to
firm a planned order and convert it to a production order, and how to evaluate the capacity
implications of this production order on the ASSY workcenter. You will also extend the material
master for the RFK bike to include Sales views, enter a sales order, and review the affect that this
order has on available to promise (ATP).
4.1 Change the system configuration to enable CRP
4.1.1 Before we proceed to detailed planning we need to modify the system configuration for the GBC.
Configuration of SAP for a particular company is extremely complicated and time-intensive, and is the
critical component of any implementation. For the most part, we are focusing on entering master data,
planning and execution for a pre-configured system. However, since the system as configured cannot do
CRP, we need to enter the Implementation Guide (IMG) interface to modify the configuration. BE
EXTREMELY CAREFUL IN THIS SECTION, AS IT IS VERY EASY TO DO SERIOUS UNFIXABLE DAMAGE TO YOUR DATA IN THE IMG. IF YOU MAKE AN ERROR, I MAY NOT BE
ABLE TO FIX IT AND YOU WILL HAVE TO START FROM SCRATCH AT LAB 1.
From the Easy Access menu, enter the transaction code to access the IMG.
1. Enter spro in t-code field
2. Select enter
121
4.1.2 Continue on to access the IMG
1. Select SAP Reference IMG
122
4.1.3 You now see the IMG menu, which lists hundreds of configuration transactions. Expand
the menu tree to show the transaction specified below.

SAP Customizing Implementation Guide > Production > Capacity Requirements
Planning > Operations > Scheduling > Define scheduling parameters for planned orders
Once the transaction is shown, select the execute icon.
1. Select Execute icon for Define
scheduling parameters for
planned orders
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4.1.4 Follow the directions below to create a new entry.
1. Select New Entries
124
4.1.5 Follow the directions below to create and save a new entry.
1. Enter ##A1 for Plant
2. Enter * for Order type
3. Enter 1## for ProdScheduler
4. Enter 180 for Sched. hor det.
5. Check Scheduling
6. Check Generate capacity reqs
7. Select Backwards for Scheduling type
8. Select Save
125
4.1.6 Select Exit to return to Display IMG menu. Select Exit twice more to return to the Easy
Access menu.
1. Select Exit three times
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4.2 ~ Run the MPS Process (Single-Level)
4.2.1 The MPS and MRP processes calculate the master production schedule and material
requirements plan based on client configuration, material master data, forecasted demand
(independent demand), and bills of material & routings (dependent demand).
4.2.2 This lab is structured to run the MPS and MRP processes in two stages. In this first stage
(exercise 4.2), you will calculate the MPS for the finished good alone. You will review the
results of this calculation and then proceed to exercise 4.3 to calculate the material requirements
plan. This two stage strategy for calculating the overall plan gives the production planner the
opportunity to evaluate any planned orders generated by the MPS process prior to the calculation
of the material requirements plan. This is advantageous when the bill of material is very
complex. It would also be useful if we wanted to do some rough-cut capacity planning before
running MRP.
4.2.3 Begin by navigating to the transaction shown below.

Logistics > Production > Production Planning > MPS > MPS > Single-Item, Single-Level
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4.2.4 Perform the following activities at the Initial Screen. Accept the defaults unless
otherwise specified.
1. Enter FG-0021-## for Material
2. Enter ##A1 for Plant
3. Enter 2 for scheduling
4. Select enter
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4.2.5 Select enter at the warning message. It’s just asking you to double check your parameters.
1. Select enter
4.2.6 A SKU (Stock Keeping Unit) is defined as a material (or item) at a specific location.
SKUs are often expressed in the following shorthand manner, MaterialCode.PlantCode (e.g.
FG-0021-##.##A1), with a period separating the item and location. This shorthand notation will
be used in the remaining lab exercises.
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4.2.7 Return to the main SAP Easy Acess menu and pull up the Stock/Requirements List for
the FG-0021-##.##A1 SKU. Note that planned orders (PldOrd) have been created for the
product. The planned order receipts, or planned finish times, are listed in the S/R list. Since the
lot-sizing rule is lot-for-lot with a minimum order quantity of ten, our MPS basically is planning
on receiving a batch of bikes on the day that each demand occurs. Note that each planned order
has a specific order number in the MRP element data column. Note that no planned orders are
created within the time fence, although an exception message is generated suggesting that the
planner reschedule the first planned order within the time fence.
Note further that with the planned order receipts, we now have positive projected available
balance for most of the planning horizon.
2. Planned order number
1. Planned order receipt of
50 units to cover safety
stock shortfall
Your exact values may differ
3. Exception message and
suggested reschedule date
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4.2.9 Summary: You have now calculated the master production schedule for the RFK bike
using the single-item, single-level MPS process.
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4.3 ~ Extend the Material Master (Sales Master data)
4.3.1 Before you can enter a sales order and subsequently evaluate available to promise (ATP),
you must update the material master for the RFK bike to include sales configuration data. As
you learned in lab 3, this is known as extending the material master, meaning that you are
extending (or adding) configuration in additional functional areas for a material.
4.3.2 Refer to your lab 1 to start the Create Finished Product transaction.
4.3.3 Follow the instructions below at the Initial Screen.
1. Enter FG-0021-##
2. Enter Retail
3. Select Select views
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4.3.4 We are going to add the Sales: Sales Org. Data 1 and 2 views, the Sales: General/Plant
Data view, the Accounting 1 view and the Costing 1 view. The sales views will add sales
organization data about the product (who within the company sells it, what distribution channels
are used, etc.), while the accounting and costing views will add pricing and accounting
information. To add these views, we first de-select all views and then select the specified views.
Perform the following activities at this screen.
1. Deselect all views
2. Select Sales Org. Data1, Sales Org.
Data 2, Sales: General Plant Data
3. Scroll down to select
more views
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4.3.5 Continue selecting the views noted below.
1. Select Accounting 1 and Costing 1
2. Select Create views
selected
3. Select enter
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4.3.6 Enter the Plant, Sales Org, and Distr. Channel at the Organizational Levels dialogue
box. Some of the information we’re going to enter in specific to this plant, sales organization,
and distribution channel combination. For example, we would probably have different prices for
the bike if we sold it direct over the internet (a different distribution channel than wholesale).
1. Enter ##A1 for Plant
2. Enter ##A1 for Sales Org.
3. Enter WH Distribution
Channel
4. Select enter
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4.3.7 Enter the following information at the first Sales org view.
1. Enter 01 for Sales
Division (if not greyed out)
2. Enter ##A1 for
Delivering Plant
4. Select Conditions
3. Enter 0 for the Tax
Jurisdic Code. Enter 0 for
the County Sales Tax. Enter
0 for City Sales Tax. You
may have to scroll down to
access the City Sales Tax
entry
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4.3.8 Pricing is pretty simple for the RFK. Each one sells wholesale for $390 USD. Enter the
following information at the first Create Price Condition screen.
3. Select Back
1. Enter 1 for Scale
quantity
2. Enter 390 for Amount
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4.3.9 This brings us back to the main Sales org. 1 view. Select enter to continue to the next
view.
1. Select enter
138
4.3.10 This brings up the Sales org. 2 view. Enter the following information at the second Sales
org view.
1. Enter 1 for Matl statistics
grp. This a group defined
for reporting purposes.
2. Select enter
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4.3.11 This brings up the Sales General/Plant view. Enter the following information.
1. Enter 0001 for Trans. Grp. This
defines how the product is packaged
for shipping.
2. Enter 0002 for LoadingGrp. This
defines what equipment we need to
load the product for shipping.
3. Select enter
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4.3.12 This brings up the Accounting 1 view. While we sell the RFK for $390, we value it
inventory at $340. We are using standard costing (Price control = S) which means we will not
automatically update the standard price. The valuation class, which is finished goods, indirectly
tells SAP what general ledger accounts get debited and credited when RFK bikes move in and
out of finished goods inventory. Enter the following information.
1. Enter 7920 for Valuation
Class
2. Enter S for Price control
3. Enter 1 for Price Unit
4. Enter 340 for Standard Price
5. Select enter
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4.3.13 This brings up the Costing 1 view. This view is concerned with managerial rather than
financial accounting. Enter the following information.
3. Select Save
1. Select With Qty Structure
2. Select Material origin
4.3.14 Summary: You have now configured this material for sales. We also added financial
information that will enable SAP to automatically keep track of the financial implications of
sales and production. In the next exercise, you will enter a sales order.
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4.4 ~ Enter a Sales Order
4.4.1 You just received a call from the Heartland Bike Company to place an order for 20 cases
of the RFK bike. Generally, it is the responsibility of a customer service representative to field
calls and formally enter sales orders in the ERP system.
4.4.2 Use the transaction below to enter this order.

Logistics > Sales and Distribution > Sales > Order > Create
4.4.3 Enter the following information at the Initial Screen.
1. Enter OR for Order Type
2. Enter ##A1 for Sales
Organization
3. Enter WH for
Distribution Channel
4. Enter 01 for Division
5. Select enter
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4.4.4 This brings up the Create Standard Order Overview screen. Before we enter the order, we
must search for the customer number. Search for your customer number (Sold-to party) as
shown below.
1. Place cursor in Sold-to
party field and select Search
icon
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4.4.5 Continue to search as shown below.
1. Select Customers per
sales group tab
2. Enter ##A1 for Sales
Organization
3. Accept default values for
distribution channel and
division
4. Select enter
4.4.6 Continue to search as shown below.
1. Select Heartland
Bike Company
2. Select enter
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4.4.7 Let @@@ represent the customer number of the Heartland Bike Company. Enter
the sales order information as shown.
1. Copy the customer number you found
for the Sold-to party into the field for the
Ship-to party (the Sold-to and Ship-to
should be the same)
2. Enter WHP125## as the PO number
(this is the number given to you by your
customer).
3. Enter a Req. deliv date and Pricing date
of today’s date plus two months
4. Enter FG-0021-##
as the Material
5. Enter 20 as the
Order Quantity
6. Select Save
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4.4.8 Acknowledge the warning that the invoice date has been calculated.
1. Select enter
4.4.9 Summary: You have now entered a sales order for 20 units of the
RFK bicycle for the Heartland Bike Company. In the next exercise, you will examine how this
sales order affects ATP.
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4.5 ~ Review ATP
4.5.1 Available to promise is the quantity of current inventory and planned production that is
not promised to other customers. While there are numerous ways to review the ATP condition
for a given product in SAP, we will focus on the ATP column of the Stock/Requirements List in
this exercise.
4.5.2 Pull up the Stock/Requirements List using the transaction code that you learned in lab 3.
Configure the Initial Screen as shown.
1. Select Individual access
2. Enter FG-0021-## for
Material
3. ##A1 for Plant
4. Select enter
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4.5.3 Select summation icon to view ATP information.
1. Select Period Totals icon
149
4.5.4 Perform the following activities to navigate to the week with the sales order for twenty
units. Note that in all other weeks, the ATP equals the production quantity in that week. In the
week with the sales order for twenty, the ATP is the difference between the planned receipt and
the sales order, as expected.
1. Select Weeks tab
2. Scroll down until you see the sales
order for 20 in the Requirements row
3. Note ATP is Receipt - Requirement
4.5.5 Summary: You have now reviewed the available to promise condition for the RFK bike.
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4.6 ~ Run the MRP Process (Multi-Level)
4.6.1 Let's assume that you have reviewed and approved the master production schedule created
in exercise 4.1. Now, you will execute the multi-level MRP process for selected level 1 and 2
semifinished goods and raw materials for the RFK bike. Before running MRP, however, you
have just received notice that the vendor for posts (RM-0090-##) is going to charge an extra
handling fee unless you order in batches of 250. You decide to order in batches of 250 to avoid
the fee. Therefore, use the Change Material Master command (use your favorite shortcut) to
change the lot sizing procedure to FX and set the Fixed Lot Size to 250.
1. Enter FX for Lot size
2. Enter 250 for Fixed Lot size
3. Select Save
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4.6.2 Begin MRP by navigating to the transaction shown below.

Logistics > Production > MRP > Planning > Single-Item, Multi-Level Planning
4.6.3 The RFK bike has several level 1 components, but we are just going to run MRP for the
RFK saddle subassembly. Since we are running multi-level MRP, this will also plan for all the
level 2 raw materials that go into the RFK saddle. Perform the following activities at the Initial
Screen. Accept the defaults except where indicated.
1. Enter SF-0031-## for Material
2. Enter ##A1 for Plant
3. Enter 2 for scheduling
4. Select enter
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4.6.4 Select enter to acknowledge the warning.
1. Select enter
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4.6.5 The following screen shows the results of the MRP run. It looks like three materials (the
saddle and two raw materials) had planned order receipts generated. Three purchase requisitions
were created, but 134 planned orders were created (your number of planned orders and purchase
reqs may differ).
4.6.6 Summary: You have now calculated the multi-level material requirements plan for the
RFK saddle subassembly and its component raw materials.
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4.7 ~ The Stock/Requirements List
4.7.1 The most commonly used SAP transaction for evaluating the supply and demand
conditions for a given material is the Stock/Requirements list. You should have some baseline
experience with this transaction thus far. We will expand this knowledge in this exercise.
4.7.2 The collective access method for viewing the S/R list allows you to see a list of materials
based on criteria that you specify. In lab 3, we used the Product group criterion to view all S/R
lists for the RFK bike. You will now use the collective access method to view all of the materials
in your Plant that have your MRP Controller setting. (Remember: You defined the MRP
controller on your materials when you created them).
4.7.3 Start the Stock/Requirements List transaction using the transaction code that you learned
in lab 3.
1. Select Collective access
2. ##A1 for Plant
3. Enter 1## for MRP Controller
4. Select enter
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4.7.4 Select Yes in response to the information request.
1. Select Yes
4.7.5 Select the Saddle – RFK, Seat – RFK, Clip, and Post materials. This includes all the
raw materials to make the RFK saddle as well as the RFK saddle itself. Note that there is current
inventory on hand for the clip and post, but not for the saddle or the seat. Note that the traffic
lights for the saddle and seat are red, but are green for the clip and post. Note the number of
each type of exception message for each part.
1. Select Saddle-RFK, Seat
RFK, Clip, and Post
2. Select Selected
stock/requirements lists
156
4.7.6 The S/R list for one of your four materials will be displayed. You could use the navigation
buttons to move back and forth between the materials, but another way to do the same thing is to
use the overview tree. Display the overview tree by following the instructions shown below.
The overview tree allows you to navigate back and forth between the plans of your selected
materials by double-clicking on them.
1. Select Show Overview Tree
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4.7.7 Use the overview tree to select the RFK saddle subassembly. Note that demand for the
saddle is referred to as DepReq (for dependent requirements) in the MRP elements column
[Recall that demand for the end item RFK bike was called independent requirements). The
parent part generating the dependent demand is noted in the MRP element data column. The
planned order receipts are noted as is the order number. Note the exception messages for the
planned orders close to the current point in time. The system is warning the planner that this
stuff needs to be scheduled now, and that perhaps there is not enough time to complete the orders
by the due date indicated by the dependent requirements.
1. Double-click to select SF-0031-##
2. Dependent requirements
3. Parent item
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4.7.8 Use the overview tree to select the Post. Note that we have 500 units in inventory, so for
several weeks the dependent demand is satisfied by inventory and there are no exception
messages. Note also that the parent of RM-0090-## generating the dependent requirements is
the saddle.
1. Double-click to select RM-0090-##
159
4.7.9 Scroll down to see where the inventory runs out and planned order receipts have been
generated.
1. Use scroll buttons
2. First planned order receipt
160
4.7.10 Follow the instructions below to view a graph of your inventory position over time.
1. Select Graphic from the List menu
item
4.7.11 Check the following boxes in the popup menu.
1. Check Reqmts planning, Requirements,
Receipts, and Avail quantity
2. Select enter
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4.7.12 Does this look familiar (It’s the sawtooth diagram we saw in class showing inventory
over time)? Note that the projected available balance for posts starts out high and drops steadily
as posts are used to make saddles. Eventually the supply runs out and parts are ordered to cover
the drop in supply. Close the graphic are reviewing it.
1. Close the
graphic
162
4.7.13 Now we want to investigate the details of a planned order release. Back in the main
screen of the S/R list, click on the details icon for the first purchase order.
1. Select details icon
for first PldOrd
163
4.7.14 The popup screen gives the order number, order quantity, planned order release time and
planned receipt time. Note that the lead time for delivery is two days. To see what parent item is
generating demand for this planned order, hit the pegging icon.
1. Select pegging icon
164
4.7.15 The new popup tells us that the 250 units of posts in a single batch is being used to cover
gross requirements ultimately generated by several different planned order releases for RFK
bikes. The posts have been “pegged” all the way up to the finished goods. To see the
intermediate step for posts – which first go into saddles, and then go into the RFK bikes – select
the first pegged requirements and select Order Route.
2. Select Order Route
1. Select first pegged
order
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4.7.16 The bottom part of the screen shows how the four posts from the planned order receipt
from posts are part of a total of eighteen posts needed to make eighteen saddles. The eighteen
saddles are used to make the eighteen RFK bikes in the order you highlighted in the top part of
the screen. Once you understand this select the exit icon to return to the S/R list. Then return to
the Easy Access menu.
3. Back to S/R list
1. Receipt dates for
planned orders
2. Planned order
numbers
4.7.17 Summary: You have now used the Stock/Requirements List to diagnose the plans of
the component materials.
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4.8 ~ Capacity Requirements Planning
4.8.1 In this exercise, you will learn how to evaluate the impact of the material plans on work
center capacity. We have only generated material plans for making the RFK bike and the RFK
Saddle, but we can see the impact of this on the assembly workcenter.
4.8.2 We will end this exercise by checking the capacity of the ##WC1 workcenter using the
following transaction.

Logistics > Production > Capacity Planning > Evaluation > Work Center View > Load
4.8.3 Configure the Initial Screen as shown.
1. Enter ##WC1 for
Workcenter
3. Select enter
2. Enter ##A1 for
Plant
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4.8.4 Here you can see the capacity requirements for your production of RFK bikes and saddles.
As you can see, the workcenter has ample capacity to process the planned orders. Select the
graphic icon to see a graphic representation.
1. Select graphic icon to
see graphic representation
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4.8.5 The graph clearly shows that we have lots of spare capacity in workcenter ##WC1 for the
next several weeks. After studying the graph, close the window to return to the main screen and
then exit to the easy access menu.
1. Close window to return
to main screen.
4.8.6 Summary: You have now generated material and capacity plans for manufactured and
purchased parts. Now it is time to move on to lab 5, where you will execute some of these plans.
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Purchasing and Accounting
Everything we have done up to now has involved planning. Now we will execute one of those
plans. In lab 5, you will extend the material master to enter purchasing master data, create
vendors, and purchase info records. You will also use the MRP process to drive procurement,
cut a purchase order, receive a purchase order, and process payment for goods received. You
will finish by evaluating the impacts on the general ledger by the various stages of the
procurement process.
5.1 ~ Extend the Material Master (Purchasing Views)
5.1.1 In this exercise, you will extend the material master for RFK seat with purchasing and
accounting configuration. This configuration is required to support the purchasing process;
without it, you would not be able to purchase materials. You may recall that you gained some
experience configuring the material master in Lab 1, so you should be familiar with how a user
generally navigates within the material master.
5.1.2 To begin this exercise, refer to the create Raw Material transaction in lab 1 and start the
transaction. Enter the following at the Initial Screen.
1. Enter RM-0101-## as Material
2. Enter Retail
3. Select enter
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5.1.3 Select the following material master views.
1. Deselect all views
3. Select enter
5.1.4 Enter the plant.
1. Enter ##A1 for your plant
2. Select enter
171
5.1.5 This brings us to the purchasing view. Your purchasing group may have been
automatically entered. If not, configure the purchasing tab as shown.
1. Enter ##A for your
purchasing group if needed
2. Select enter
172
5.1.6 We must now enter the value of a single seat for accounting valuation purposes. The
valuation class is a code indicating what type of inventory the seat is classified as (and therefore
what type of automatic accounting rules apply when a transaction involving RM-0101-##
occurs). Configure the Accounting 1 tab as shown.
1. Enter 3000 for the Valuation Class
2. Make sure Price control is V
4. Select enter
3. Enter 45.00 for the Moving price
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5.1.7 Configure the Costing 1 tab as shown. These settings tell the system to allocate the
detailed material costs involving RM-0101-## to the appropriate cost center (which is specified
in the configuration of the cost accounting modules).
3. Select Save
1. Check With Qty Structure
2. Check Material origin
5.1.8 Summary: You have now extended the material master for the RFK seat to include
purchasing and accounting configuration.
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5.2 ~ Create Purchasing Info Records
5.2.1 Your purchasing department has decided that you will buy the RFK seat from Great Lakes
Bike Supply, one of your regular vendors. You need to relate the new raw material (the seat) to
this vendor. This is done by creating a Purchasing Info Record. The purchasing info record
provides continuously updated information about the relationship between a specific material
and a specific vendor. For example, different vendors may sell you the same part for different
prices, and this purchasing information record is where this information is maintained. This data
includes order unit, price, price changes, tolerances, historic data, statistics, texts, etc. This data
can be updated manually or automatically.
5.2.2 To begin, double-click on the transaction below:

Logistics > Materials Management > Purchasing > Master data > Info record > Create
5.2.3 Configure the Initial Screen as shown.
1. Enter RM-0101-## for Material
2. Enter ##A1 for Purchasing Org.
3. Enter ##A1 for Plant
4. Select search icon for vendor
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5.2.4 Continue searching for the vendor doing the actions below.
1. Select Vendors by Company Code
2. Enter ##A1 for Company Code
3. Select enter
5.2.5 Continue searching for the vendor doing the actions below.
1. Select Great Lakes Bike Supply
2. Select enter
176
5.2.6 Access the PIR screen.
1. Select enter
177
5.2.7 Navigate to the Purch. Org. Data 1 screen.
1. Select Purch. Org. Data 1
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5.2.8 Enter the following information.
1. Enter 3 for Pl. Deliv. Time
2. Enter ##A for Purch. Group
3. Enter 25 for Standard Qty
4. Enter 45.00 for Net price
5. Select Save
5.2.9 Summary: You have now established the relationship between your raw material (RFK
seat) and your vendor (Great Lakes Bike Supply).
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5.3 ~ Create a Purchase Order
5.3.1 Before creating a purchase order, Single-Item Multi-Level MRP needs to be rerun for the
RFK saddle assembly (SF-0031-##). Use the same settings as used in lab 4. This is a critical
step, as the MRP must be rerun after the Purchasing Information Record is established.
5.3.2 Pull up the Stock/Requirements List for the RFK seat (RM-0101-##). Look closely at the
first planned order receipt (PldOrd) on the Stock/Requirements List.
5.3.3 Before you go any further, let's define some terms as they are used in SAP.
Planned Order
A planned order is an MRP request for the procurement or production of a particular material at
a determined time. It specifies when the inward material movement should be made and the
quantity of material that is expected. As mentioned in previous labs, the planned order shown in
SAP is the planned order receipt.
Purchase Requisition
A purchase requisition is a request or instruction to purchasing to procure a certain quantity of a
material or a service so that it is available at a certain point in time. It is considered a stronger
commitment to buying then an automatically-generated planned order. Basically, a purchase
requisition is considered to be firmed, meaning it won’t be changed automatically when MRP is
rerun. A purchase requisition is therefore the purchasing equivalent of a firm planned order for
a part that is produced rather than manufactured. A purchase requisition can be fulfilled through
purchase orders or longer-term purchase agreements.
Purchase Order
A purchase order is a formal request or instruction from a purchasing organization to a vendor or
a plant to supply or provide a certain quantity of goods or services at or by a certain point in
time.
Basically, demand for a part far in the future creates a planned order automatically through MRP.
Planned orders may be converted to purchase requisitions automatically (through rules involving
time fences and lead times) or manually. Purchase requisitions are then converted to purchase
orders manually by the planner.
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5.3.4 Some purchase requisitions may have been created automatically for the immediate
periods when you ran MRP. We will ignore them so we can go through the entire planned orderpurchase requisition-purchase order cycle. Scroll down to the first planned order in your
Stock/Requirements List and perform the following activities. Again, your numbers will differ
from those below.
1. Select details icon
for first PldOrd
181
5.3.5 We want to manually convert this planned order to a purchase requisition. Perform the
activity shown below.
1. Select -> Pur. Req.
5.3.6 This brings up the Convert Planned Order into Purch. Req. screen. Save the conversion
without making changes.
1. Select Save
182
5.3.7 Back at the S/R List, refresh the screen to see the new purchase requisition.
1. Select Refresh
183
5.3.8 Note that the newly converted purchase requisition has an asterisk after it, indicating that
the requisition was created manually and therefore firmed, i.e it won’t be automatically changed
with a new MRP run. Select the details from icon for this newly created purchase requisition.
1. Select details icon
for new PurRqs
184
5.3.9 Now we want to manually convert the purchase requisition to a purchase order to send to
the vendor. Perform the following activities.
1. Select -> Purchase
Order
5.3.10 To complete the conversion, we must select our open requisition and confirm the
conversion. Perform the following activities.
1. Select the open
requisition
2. Select Adopt to copy the pur req
details to the new purchase order
185
5.3.11 After the information is copied, save your purchase order.
1. Select Save
5.3.12 The system is not configured to print the purchase order or send it electronically to a
vendor, so this generates a warning message. Since this is not a real purchase order, we ignore
the warning. Save data at popup message.
1. Select Save
186
5.3.13 Refresh the Stock/Requirements List to view your new purchase order.
1. Select Refresh
2. POitem represents
new purchase order
5.3.14 Summary: You have now converted one output of the MRP process into a purchase
order.
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5.4 ~ Record a Goods Receipt
5.4.1 A Goods Receipt is the system representation of the physical receipt of inventory into a
stocking location. It leads to an increase in warehouse stock and affects the General Ledger.
Post a Goods Receipt
5.4.2 The Great Lakes Bike Supply Company has just delivered the purchase order of seats
created in the previous exercise. Post a goods receipt for this purchase order using the transaction
below.

Logistics > Materials Management > Inventory Management > Goods Movement > Goods
Receipt > For Purchase Order > GR for Purchase Order
5.4.3 Hide the Overview if it is showing to unclutter the screen.
1. Hide Overview
188
5.4.4 Search for your PO number.
1. Select search icon
189
5.4.5 You will want to search for the purchasing documents using the “purchasing documents
per vendor” search screen. Since that is not the default search screen, you must first select the
the correct search screen by performing the actions below.
1. Select search screen
list
2. Select “Purchasing
Documents per Vendor.”
5.4.6 Now that the proper search screen is shown, specify that you want to see all purchase
orders from the ##A purchasing group from withing the ##A1 purchasing organization.
1. Enter ##A1 for
Purch. Organization
2. Enter ##A for
Purchasing Group
3. Select enter
190
5.4.7 Select purchase order (there is only one outstanding).
1. Select purchase order
2. Select enter
191
5.4.8 Selecting enter will cause SAP to retrieve and display the details of the purchase order on
the goods receipt screen. You then check OK to indicate that all items in the receipt are ok,
have been received into inventory, and are ready for production. You most also enter the storage
location (SLoc) where the items will be stored until used. [NB: If you cannot check the OK box
because it is grayed out, you will need to scroll down and close the details view (not shown).
Ask your instructor how to do this].
1. Select Enter
2. Check OK
3. Enter 10 for SLoc
4. Enter Save
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Display Stock After Receipt of Goods
5.4.9 Pull up the Stock Requirements/List for RM-0101-## in Plant ##A1 to review the
inventory level. Note that the purchasing order has been received into inventory. Write down
the inventory level. It may differ from that shown below, and you will need this number later on
in the lab.
1. Current inventory level
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5.4.10 Posting a goods receipt will also automatically affect the general ledger of the Global
Bike Company. Navigate to the following transaction to evaluate this impact the general ledger
account for raw materials.

Accounting > Financial Accounting > General Ledger > Account > Display Balances
1. Enter 2001## for Account Number
2. Enter ##A1 for Company Code
3. Enter the current year for
Fiscal Year
4. Select Execute
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5.4.11 Note that receiving the goods has resulted in a debit (increase) in our raw materials
account. The amount is equal to the product of the number of items purchased and the item
value we entered in the PIR. [26 units x $45/unit] = $1170. Your amount may differ; write down
the amount of the posting. This is also the amount you will be billed for, and you will need the
amount to post the imaginary invoice in the next step.
1. Write down your amount.
5.4.12 Summary: You have now viewed how posting a goods receipt affects the on hand
inventory balance and the general ledger.
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5.5 ~ Record Receipt of an Invoice
5.5.1 After sending the goods that you ordered, the vendor will send you an invoice to request
payment. If you were a frequent customer of Great Lakes Bike Supply and they had a robust
information system (like SAP), you could configure the systems so that the invoices would be
sent electronically and this manual step would not be required. However, for the purposes of
demonstration in this lab, you will be manually creating an invoice receipt.
Record the Receipt of an Invoice
5.5.2 Use the transaction below to record the receipt of an invoice.

Logistics > Materials Management > Logistics Invoice Verification > Document Entry > Enter
Invoice
5.5.3.0 You might be prompted to enter your company code. If so, notify your instructor.
5.5.3 Enter the date and invoice amount and then search for the relevant purchase order number.
It is important that you enter YOUR invoice amount from the previous exercise, which may be
different from the amount shown below.
1. Enter today’s date for Invoice date
and Posting Date
2. ENTER YOUR INVOICE AMOUNT
FROM THE PREVIOUS EXERCISE
3. Click in this field and then select
Search icon
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5.5.4 Continue searching for the relevant purchase order number.
1. Enter ##A1 for the company code
2. Select search icon to search for vendor
5.5.5 Now “search within the search” for the vendor number.
1. Enter ##A1 for the company code
2. Select enter
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5.5.6 Select the vendor as shown below.
1. Select Great Lakes Bike Supply
2. Select enter
5.5.7 Now execute the search for the purchasing document.
1. Select Execute
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5.5.8 Copy the purchase order number and return to the "Enter Invoice" screen.
1. Check the box next to the purchase order
2. Select Copy
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5.5.9 Retrieve the purchase order information by clicking enter and then simulate the invoice
posting. This is basically a test to make sure the numbers match up right.
1. Select Enter
2. Select Simulate
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5.5.10 It looks like debits and credits add up to zero. Therefore, post the invoice (if they don’t
add up to zero, notify your instructor).
1. Select Post
5.5.11 Posting an invoice will also automatically affect the general ledger of the Global Bike
Company. Navigate to the following transaction to evaluate this impact the general ledger
account for accounts payable.

Accounting > Financial Accounting > General Ledger > Account > Display Balances
1. Enter 3001## for Account Number
2. Enter ##A1 for Company Code
3. Enter the current year for
Fiscal Year
4. Select Execute
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5.5.12 Note that receiving the invoice has resulted in a credit (increase) in our accounts payable
account. We basically owe Great Lakes Bike Supply the amount shown.
5.5.13 Summary: You have now reflected receipt of an invoice for goods delivered from the
Great Lakes Bike Supply company.
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5.6 ~ Pay the Invoice
5.6.1 There’s no free lunch, so you will use the following menu path to pay the invoice.

Accounting > Financial Accounting > Accounts Payable > Document Entry > Outgoing Payment
> Post
5.6.2 You will be paying the invoice out of the GBC bank account. Follow the instructions
below at the Post Outgoing Payment screen.
1. Enter today’s date for the Document
and Posting Dates
2. Enter 1001## for the general ledger
account number for your bank Account
3. ENTER YOUR INVOICE AMOUNT
FROM THE PREVIOUS EXERCISE
4. Select the Search Icon to search for your
vendor (Great Lakes Bike Suppy). Use the same
procedure as shown in 5.5.5 and 5.5.6.
5. Select Process open items.
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5.6.3 The “not assigned” amount in the lower right hand corner should be zero, indicating that
you are going to pay the full amount of the invoice. If this amount is not zero, notify your
instructor. Otherwise, at the Process open items screen, post the payment.
1. Inspect Not
assigned amount
2. Select Post
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5.6.4 Posting a payment will also automatically affect the general ledger of the Global Bike
Company. Navigate to the following transaction to evaluate this impact the general ledger
account for the cash bank account.

Accounting > Financial Accounting > General Ledger > Account > Display Balances
1. Enter 1001## for Account Number
2. Enter ##A1 for Company Code
3. Enter the current year for
Fiscal Year
4. Select Execute
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5.6.5 Note that paying the invoice has resulted in a credit (decrease) in our cash bank account.
If we were to check the accounts payable, we would also find that it has been debited and zeroed
out. As we would expect, the net effect of our buying parts from Great Lakes Bike Supply has
been that we have more inventory and less money. Note that all this happened without using a
bookkeeper; SAP automatically generates the accounting transactions when money or its
equivalent moves from one place to another.
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Ridge Front DeLux Bike Project
Project Description
Global Bike Corporation is launching a new bicycle to capitalize on the market demand for cushier seats
for the aging baby boomer population. This bicycle is called the Ridge Front Delux bicycle. You must
use the concepts and instructions provided in the five in-class SAP labs to complete this assignment.
To demonstrate that you have successfully completed the project, you must turn in a file containing the
screenshots identified below on the course Blackboard website (in digital format). Each screenshot
should be pasted into a PowerPoint slide (see below) and clearly labeled. There should be a title for each
slide saying what is on the screenshot, and textboxes with arrows should highlight the relevant quantities
(just like in the documentation for the labs). If you simply turn in unlabelled screenshots you will lose
points.
Evidence of Manufacturing
You must turn in a screenshot of the Stock/Requirements List for the following FERT, HALB, and ROH
materials used in the manufacture of the RFD bicycle: The RFD bike itself; the RFD Saddle assembly;
the RFD seat; the RFD post; the RFD rear wheel assembly; the RFD rear rim; and the RFD rear tire.
Note that the post, rear wheel assembly, rear rim, and rear tire are all the same as those used on the RFK
bike. There are thus seven screenshots needed for evidence of manufacturing.
These screenshots must clearly show your Data Set Number (highlighted with a label). They must also
demonstrate that you have successfully executed the MPS and MRP processes on the appropriate
materials (for the raw materials used in other products, you must therefore be sure to show and highlight
dependent requirements generated by planned production of the RFD saddle). Planned orders on each
screenshot must be sufficient to fulfill fifty units of customer demand for the RFD bicycle (see below for
detailed demand information).
Evidence of Procurement
You must also turn in a screenshot of the “Post Outgoing Payments: Process open items” (just prior to the
save step) to prove that you have bought and paid for the required quantity of RFD seats. This screen is
encountered in the transaction where you record paying for the invoice. Be sure to take this screenshot
BEFORE saving, or you will not be able to capture the screenshot.
Requirements, Advice, Hints, and Suggestions
You will not have to do all the steps performed in the five SAP labs. Some steps may be simplified or
omitted; new steps not covered in the lecture will be described on the following page. The purpose of this
assignment is to have you go through the labs a second time thinking about how you must use each
transaction to obtain a desired result, which is to produce enough of the seven parts listed above to meet
demand for fifty RFD bicycles.
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Consulting Fees
You may find in industry that your company is charged consulting or support fees for answers to ERP
navigational questions where documentation is otherwise provided. Generally, there will be no charge
(no points loss) for questions that would be categorized as “case” questions, i.e. for questions about the
requirements of the project. However, there will be a $10 charge (1/10 of 1 point) for navigational
questions that could have been otherwise answered using the online lab documentation. Your total budget
for consulting is $500, with each $100 equal to 1 point for the project. You may therefore spend up to 5
points of the 20 point total for the project in seeking navigational or debugging assistance.
Material List
These are new materials that you must create to manufacture the RFD bike. Unless otherwise noted, use
the settings for each material type described in the RFK configuration.
Material
Code
Description
Material Type
Lot Sizing
Safety Stock
FG-0022-##
## RFD Bicycle
FERT
Lot for lot
0
SF-0032-##
## RFD Saddle Assembly
HALB
Lot for lot
0
RM-0102-##
## RFD Seat
ROH
Fixed lot size=250
75
Bill of Materials
The multi-level BOM for the RFD is the same as that of the RFK except that the RFD Saddle and RFD
Seat replace the RFK Saddle and RFK Seat.
Purchasing Information
You will buy the RFD seat from the same company from which you buy the RFK seat. You also decide to
keep the same level of safety stock for RFD seats as for RFK seats. The price per RFD seat is, however, a
rather pricy $65.
Demand
The RFD sells for $440, although a completed unit is valued for accounting purposes at $380. You will
not be forecasting demand for the RFD bicycle using the forecasting capabilities of SAP ECC 6.0.
Instead, you will enter a planned independent requirement for fifty FG-0022-## bikes for the month of
July, 2010. The transaction code to create a planned independent requirement is MD61 (change is
MD62, display is MD63). Be sure to save your changes. The demand will be displayed in your
Stock/Requirements List.
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Screenshot “How to”
All evidence of your project work must be turned in electronically via project links in the Blackboard
grade book. Ensure that your Data Set Number is clearly displayed in any screenshots that you submit.
Follow the procedure below to capture your screenshots:
1. Simultaneously press the <Alt> key and the <Prnt Scrn> to capture a screenshot and store it on
the Windows clipboard.
2. Open up MS PowerPoint and press <Ctrl> plus <V> to paste the screenshot into PowerPoint
3. Format your presentation as you deem appropriate for managerial review. Again, screenshots
without explanatory titles or labels will lose points.
Be sure to use your Data Set Number in all of the exercises.