Procurement Logistics - PowerPoint PPT Presentation

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Procurement Logistics

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Title: Procurement Logistics


1
Procurement Logistics
  • Chapter 7

2
Processing Stock Material
  • Shows how material flow is planned, expedited,
    and monitored in R/3 system
  • This scenario is central component of R/3s
    logistics chain.
  • Workflow depends on
  • nature of stocked items
  • quality and inspection tactics
  • accounting practices
  • MRP system provides main input

3
Processing Stock Material Scenario
  • Approval of request generation of a
    requisition
  • Finding a source of supply
  • Creating RFQ
  • Issuing PO
  • Sending PO to supplier
  • Generating EDI PO
  • (see figures 7-3 to 7-5)
  • Receiving a shipping notification from supplier
  • Receiving items into inventory
  • Issuing items to production
  • Receiving items from production

4
R/3 Procurement Terms
  • Organizational Elements
  • Plant
  • Purchasing Org
  • Purchasing group
  • Storage location
  • Storage bin
  • Business Objects
  • Purchase requisition
  • Purchase order
  • RFQ
  • Vendor quotation
  • Outline agreement
  • Service contract

5
R/3 Modules Used
  • MM mainly
  • MRP
  • EDI
  • SCM
  • APO
  • B2B

6
Procurement of Stock Material Requisition
Processing
Make-to Order Production
Production By lot size
Process Manufacturing
Repetitive Manufacturing
Planned orders created
Requirement occurred
Requisition processing to stock material
Planned order conversion MM
Planned orders converted to purchase req.
Preq. With contract order is created
Planned order is converted to purchase req.
7
Procurement of Stock Material Vendor Quotation
Processing (1)
Purchase requisition assignment
Preq. Is marked for req. for quotation
Preq. With vendor is created
Processing of RFQ issued to vendor
Go to Purchase Order Processing for Stock
Material
Requests for quotation sent to vendors
Vendor quotation processing
8
Procurement of Stock Material Vendor Quotation
Processing (2)
Rejection is sent
Quotation is selected
Contract should be created
Scheduling agreement is to be created
Scheduling agreement process
Contract Processing for Stock material
Contract is sent
Sched. Agreemt is sent
PO Processing for stock material
9
Procurement of Stock Material Vendor Quotation
Processing (3)
Purchase Order is transmitted
Material Arrived
Invoice with reference has arrived
Invoice w/o reference has arrived
Invoice Processing
Invoice is not accepted
Invoice posted and released for payment
Vendor Processing
10
Procurement of Stock Material Goods Receipt
Processing
Goods receipt processing
Goods are to be returned
Transfer order created automatically
Material is placed in stock
Material Posted to stock in qual. Insp.
Placement in storage processing
Quality Processing
Material is not accepted
Material is accepted
Material is placed into stock
11
Other Procurement Scenarios
  • Processing of consumable material
  • Management of consignment stocks
  • Subcontract order processing
  • External services management
  • Stock transfer processing

12
Chevron Corp. Procurement Case
  • 32B Company, 11th in Fortune 500
  • Ten remote plants across Southwest and South
  • Rolling out new Financial IS as part of BPR
  • existing system was 30 yo patchwork of homegrown
    systems
  • team targeted purchasing, service contracts, AP,
    Fixed-asset accounting, intercompany accounting,
    GL, capital project tracking, and financial
    reporting
  • Reengineered core financial processes with R/3
    Blueprint and SAPs best practices
  • C/S system means purchased material info is
    available instantly
  • replaced manual document management and matching
  • no need to wait for financial reports
  • resulted in 20 savings
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