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| JSPL SAP Implementation © 2008 IBM Corporation

MM PROCESSES

M M MODULE


SAP Implementation | JSPL | Confidential © 2008 IBM Corporation2

WHAT ARE THE CHANGES AND BENEFITS…?• Creation of Different Document type for material and service PO for Raigarh and all out location.

• All new vendor code introduced with proper specification of vendor and combination of vendor class and

classification.

• Introduction of comparative statement and negotiation check list as per our requirement from SAP.

• Introduction of PR type –NORMAL PR and URGENT PR

• Budget Check introduced at PR and PO level

• Extra mandatory field introduced in PR screen

• PR/PO Release via WORK FLOW

• Reminders procedure at RFQ and PO

• PR release strategy material group vise eg,Special approval item –IT, Furniture and Air Condition items

• Introduction of business intelligence BI for reporting and MIS purposes.

• Emailing solution for RFQ and PO

• GR or Inbound Delivery on receipt of materials at Port

• contracts and scheduling agreement introduced



New changes relating to Store

• Gate entry in SAP Module

• Invoicing for returning materials to vendors by store

• Sub-contracting process

• Empty cylinders management

• Gr. With reference to OBD / STO

• Gr. for finished materials issued for captive consumption.

• Purchase made against Scheduling agreements

• Work flow for PR,Po and GR

• Storage location of each plant is redefined on the basis activity e.g. DRI-Electrical,DRI-mechanical etc



Organization Structure• Plants:

• 1101- First digit – Location, Second digit- Unit, Last two digits- Serial No.

• At the Raigarh location 3 Logical Plants have been created to serve as “General Plants”

corresponding to the units

• This would facilitate the business requirement of procuring MRO items for which ROP will

be maintained and also for common materials across units

• The physical plants (logistics plant) have also been created as plants. The Purchase

Requisition Document Type would be different for each location



Plant Nomenclature



REQUSITIONER FIELD



TRACKING NUMBER



Purchase Requisitions

• Requisition documents have been classified into :

• 1. Normal (Delivery date is as proposed by system based on planned delivery time, or a date after this)

• MRP generated requisitions will also be treated as normal PR’s.

• 2. Urgent (Required Delivery date is before the delivery date proposed by the system based on the

planned delivery time)

• Release strategy applicable is determined based on the following criteria:

• 1. Document type

• 2. Total Requisition value

• 3. Material group

• 4. Plant

• 5. Requisitioner



NEW PR TYPE

NORMAL PR –

Every material code in the material master has a specified LEAD TIME and as and when a requistioner is creating a PR, system will automatically calculate the delivery date for that material as per the lead time maintained and the delivery date field will be unchangeable.

URGENT PR –

When a requistioner require a material in lesser days other then specified the he/she will use urgent type of

PR and specified their required delivery date, here the delivery date field will be changeable



URGENT PR



NORMAL PR



Additional fields in PR

• Following fields have been introduced and made mandatory at item level in the requisition

• Recommended source – (Y/N) Mandatory field• End Usage - (Y/N) Mandatory field• Whether AMC is required - (Y/N) Mandatory field• Whether spares are required - (Y/N) Mandatory field• Whether E & C is required - (Y/N) Mandatory field• Whether test certificate is required - (Y/N) Mandatory field• Last created PO number and gross price for the material in that specific region ( Raigarh /Angul / Patratu

etc) – Information • Contact person - (Y/N) Mandatory field• Phone number. - (Y/N) Mandatory field

• These fields will be editable till the PR is released for PO.



ADITIONAL FIELDS IN PR SCREEN



Additional fields in PR

SCREEN SHOT-ADD FIELDS_PR



Release strategies for RequisitionsRelease strategies for Requisitions

Note:

1. ‘GM IT’ or ‘GM HR’ will be a part of the release chain only when requisition has materials belonging to material groups ‘IT items’ or ‘HR items’

2. User will not be allowed to enter materials belonging to the material group ‘IT items’ or ‘HR items’ and materials belonging to any other material group, together in the same requisition.

3. The 'HOD USER DEPT.' (user) who is supposed to release a particular requisition will be decided on the basis of Plant

Requisition type

Requisition Value (INR)

Material group Plant Release authority

Normal 0 to 2500000IT / HR items/ Other groups ALL

HOD User dept

GM IT/GM HR/Store/PRCommitee

Normal > 2500000IT / HR items/ Other groups ALL

HOD User dept

GM IT/GM HR/Store/PR Commitee

ED

Urgent 0 to 500000IT / HR items / Other groups ALL

HOD User dept


Urgent > 500000IT / HR items / Other groups ALL

HOD User dept


ED


SAP Implementation | JSPL | Confidential © 2008 IBM Corporation

Release strategy for Purchase Orders

• The Release strategy applicable and users who are supposed to carry out the release would be determined based on the following criteria:

1. Net PO Value

PO ValueRelease authority

0 to 2500000 HOD Purchase

> 2500000 HOD Purchase ED

2. Purchase Order Document Type

3. Plant

Note:

1. All PO’s ( Service or Material) will be released by HOD purchase and subsequently by ED if the designated value limit is crossed.

2. All the Strategies are in line with the Drishti recommendations.

2. Purchase Order Document Type

3. Plant

Note:

1. All PO’s ( Service or Material) will be released by HOD purchase and subsequently by ED if the designated value limit is crossed.

2. All the Strategies are in line with the Drishti recommendations.



How budget checks will happen in PR

Every plants is linked with WBS element and BUDGET

There is a report to check BUDGET Status of the respective department

System will automatically stopped the PR creation if budget will Excess than the allotted amount.

BUDGET amount will be updated on additional amount calculated at the time of preparation of PO/GR



Basic difference in WBS

Plant Maintenance Raigarh P01/PMM

Service Raigarh P01/PMS

Investment projects ……..like(All investment projects are start with first character is “I”)

2 MTPA DRI PLANT AND GAS. UNIT II1/GDR31

CEMENT PLANT IM1/CMT31Note:-

I-investment, - First DigitI-iron segment – Mines segment - Second Digit1-Raigarh location - Third Digit 31 – Plant unit-3 and serial no



BUDGET STATUS REPORT



BUDGET



What is work flow and how it work



Introduction of WORK FLOW

Work flow is introduced in system for batter tracking and prompt information of the every action to the end user

Release of PR and PO will happen via WORK FLOW

Work flow will inform each and every end user about their respective action so that lead time to perform a work will be laser and the efficiency will improve



Work flow process and flow chart

PR/PO CREATION BY END USER

A Email will trigger toRespective HOD’s

As and when PR will release by HOD a Email Will trigged to PR creator.

As and when a PO will placed for particular PRA email will trigger to end user

After PO release mail will trigged to purchaser/po creator for PO release information



Workflow - PR



Work flow related developments

Other intimations through mail:

When goods receipt is made against a PO, mail will be sent to the requisitioner and the buyer (purchasing group) in the PO line item

Mail will be sent to HOD stores and HOD purchase if goods receipt is not posted more than 3 days after the gate entry is made .

Mail Reminders and expeditors will be sent to vendors for PO/RFQ using standard transaction. Requirement for the same is entered in PO.



Negotiation checklist & quotation Comparison– Flow of events

A template ( excel sheet) forwarded to the vendor.

Vendor reverts with the filled sheet containing all the mandatory data like RFQ number, pricing conditions, payment terms and other custom fields:

Whether tolerance is allowed – (Y/N) Test & guarantee certificate requirements – (Y/N) Performance guarantee agreements – (Y/N) Third party inspection – (Y/N) QA plan to be followed by the vendor – (Y/N) Penalty clause – (Y/N) Incentive – (Y/N) Support service at commissioning – (Y/N) Mode of transport – (Text) Coverage details – (Text) Charges paid by – (Text) Whether cenvat documents will be provided – (Y/N) Payment terms – (From allowed values)



PROCEDURE FOR CONSUMPTION OF PLANT FINISHED PRODUCTS(CAPTIVE CONSUMPTION)

PROCEDURE FOR CONSUMPTION OF PLANT FINISHED PRODUCTS(CAPTIVE CONSUMPTION)

Raising of PRs by user

Preparation of STO by purchase

Arrangement made by logistic for

processing of delivery

Excise Invoice to be raised by marketing

Materials dispatch to required indented Dept.

Receipt acknowledgement by user

Hand over of documents to store for GR. By Marketing

Gr and issue posting by store

Hand over of excise docu.to Excise for modvate



Cut over strategy - MM

Gate Entry

• Manual record to be kept of incoming and outgoing vehicles during the transition period and to be immediately recorded the same in SAP after Go-live.

Open Purchase Requisition • The open PR list is circulated to all HODs.Edited Open PR for balance quantity will be

uploaded .



Movement Type WBS Remark

221

F/SP Not Allowed

PM Not Allowed

I/C Allowed

Z01

F/SP Allowed

PM Not Allowed

I/C Not Allowed

261

F/SP Not Allowed

PM Allowed

I/C Not Allowed

Reservation - MM




Open Purchase Orders

• As far as possible Vendors should be informed to expedite the dispatches so that maximum number of Po’s can be foreclosed in old system.

• No POs should be made after a cut-off date of 25th October • Short Closure of Open Orders in old system • Open POs will be uploaded on 1st of Nov in SAP for with open quantity as on 31st Oct • Open PO data in the prescribed format to be furnished by Business • POs should include all types including Project purchases.

• Separate document type to be maintained for legacy PO for identification and without release strategy.

• Open PO volume is close to 4000 line items




Stock Upload

• Stocks as on 31st October will be collected in the prescribed format and should be made

available by 31st October midnight for data preparation and upload.

• Stocks will be uploaded with Value provided and validated by Business

• Stocks to be uploaded plant wise with value and will be signed-off by Business

• 14000 Stock items have been listed Stock-in-Transit

• Stock in transit should be avoided as far as possible by expediting the dispatches from

locations to locations before 28th October

• If at all there exists the Stock-in-transit then it will be considered as upload stock for

receiving plant/location.

• Business will keep manual record of such transactions for tallying the stock on actual

receipt.