MM Flow:
- The process begins with planning what materials are required, when they are required, and the price that the company can afford to pay for them.
- Then the company prepares a list of vendors that they think can provide the materials for them.
- The company asks each of the vendors to submit a quotation, which includes the price, terms of delivery, quality of materials, and any other information that they need for making their decision. This stage could also involve negotiating with the vendors for the best deal.
- Once a vendor has been chosen, the buyers create a purchase requisition form that includes information such as the description of goods and services, department account number, signatures of the authorized managers, delivery instructions and quotation from the authorized vendor.
- A formal purchase order is sent to the vendor to supply the goods along with instructions as to the conditions under which they have to be supplied.
- Once the company receives the goods from the supplier, the purchase department prepares a Goods Receipt. This is an important document which can later be used for reconciling if what the seller delivered was indeed what they asked for.
- The Goods Receipt is compared with the Purchase Order to validate if the two match. If there are any discrepancies, the buyer can contact the seller and post a complaint. Checks are made if the goods are suitable for use or not, if the correct quantity has been delivered, if all the goods meet the ordered specifications, and they are priced according to the terms of the purchase order. If any goods are damaged then the buyers will have to contact the sellers and ask either for a replacement or a refund.
- Once the verification of the goods is done, the payment invoice is created and the necessary approvals from the project managers are obtained.
- When the company makes the final payments to the vendor, the cycle comes to a close.
1. Purchase Re-question- ME51 (Requirement Planning)
2. Request for Quotation- ME41
3. Quotation from different vendors- ME47
4. Price comparison- ME49
5. Purchase order send to vendors- ME22
6. Goods receipts- MIGO
7. logistic invoice verification- MIRO
8. Vendor Payment- FB60
9. Receipt of Money- FB50
SD Flow:
Order-to-Cash is an integration point between Finance (FI) and Sales (SD). It is a business process that involves sales order from customers to delivery and invoice. It comprises SO, Delivery, Post Goods Issue (PGI) and billing to customers. Its configuration touches both Finance and Sales & Distribution modules. The process starts when a customer inquires for an inventory item (finished goods for a company). The customer gets quote for the item and place an order for the quantity needed. A user from company place the order and pass it for processing. Inventory gets picked up from warehouse and shipped to customer. Billing process also starts with delivery and it can be sent with the item or later.
This process gives integration between customer master record, sales organization, sales offices, distribution channels, divisions and plants.
1. Inquiry -VA11
2. Quotation - VA21
3. Sales Order Creation - VA01
4. Post Goods Issue(PGI) - VL01n
5. Delivery - VL01n
6. Billing - VF01
7. Receipt of Money - FB50
Note:
