If you’ve been following the news lately, you’ve heard about worker shortages, port congestion, remote working, fuel increases, and rising inflation. These issues impact everyone, but they’ve also led to a perfect storm of supply chain challenges for manufacturers. Optimizing the supply chain has become more difficult than ever. It’s vital to have the right amount of material in the right place at the right time, but doing so is far easier said than done.
Luckily, there is a solution to combat the risks of evolving supply chain constraints, and it’s called SAP Materials Management (MM).
What is SAP Materials Management (MM)?
SAP MM was designed to ensure that materials are always stocked in proper quantities and minimize gaps in a company’s supply chain. It also integrates with other modules like Production Planning (PP), Sales and Distribution (SD), and other SAP tools.
Implementing SAP MM provides a major opportunity to transform your company and supply chain operations. However, not all implementations go smoothly. So how do you set your company up for success?
We reached out to one of our accomplished SAP subject matter experts with experience in full lifecycle deployments combined with heavy manufacturing operations, food manufacturing, and supply chain management to pick their brain. Here are five of their recommended best practices and mistakes to avoid when getting started with SAP MM.
1) Establish Your Business Processes
Step one is to establish your business processes. You’ll do this by setting up a team of business process owners from across the company and third-party consultants. This team includes (but is by no means limited to) finance, accounting, human resources, global trade, procurement, production, execution, inventory management, and more.
Next, you’ll hold a blueprinting session to create a wishlist of how you want the system to work for your organization. Your team will then use those requirements to configure your system.
2) Set Up Accurate and Consistent Master Data
Ensuring accurate and consistent master data is vital to a successful implementation. That’s because everything in SAP MM revolves around master data, which is stored and manipulated in centralized master data tables. For example, when a production order is created, it uses master data from SAP MM about the materials needed to produce the product.
There are hundreds of fields in this section, but most companies only use a fraction of them. That being said, you will need to create a material master conversion team to take your data from whatever legacy system you have and convert it to SAP MM.
Here are a few other things to consider when setting up your master data:
- Will this part be made, purchased, or both?
- If the part is being produced and requires other components, you will need a bill of materials (BOM) to explain what parts are produced in-house, purchased externally, and the accuracy of the quantities.
- If a part is produced in-house, how will it get made? What machines will it go through? How long will it take?
- Finally, what are the in-house production times and the planned delivery time?
3) Conduct Hands-on Training
The importance of conducting thorough training can’t be overstated—if you don’t have good training, you won’t be able to use the tools effectively. A good training regimen should include a mix of classroom instruction, documentation, and hands-on training with an expert.
4) Ensure Inventory Is Accurate
As you approach go-live, you need to triple-check the accuracy of your inventory. This means that you have counted the correct number of materials and verified that it matches what you’ve included in the system. Recently, our consultant was brought into an implementation where the client didn’t do proper inventory conversion. It took days to straighten out the problem and set it up correctly, delaying the implementation time. So before you go live, make sure your inventory is loaded into the system correctly.
5) Lean On SAP Experts
Of course, the very best way to avoid common pitfalls and start gaining the benefits of your solution more quickly is to bring in experienced third-party consultants. We’ll dive deeper into the benefits of partnering with SAP consultants in our next article on succeeding with SAP MM. Remember, clients often tell us during SAP deployments, “We don’t know what we don’t know,” but hiring experienced consultants can help mitigate these problems and bridge the knowledge gap.