SAP MM (Materials Management)

An SAP MM consultant draws an average salary of $120,910 per year based on seniority level.

------------------------------------------------------------------------------------------------------------------------------------------------------------

SAP MM Interview Questions

------------------------------------------------------------------------------------------------------------------------------------------------------------

1. What is SAP MM and what do you know about it?

It is one of the modules in SAP that deals with the management of materials and procurement process. It also includes master data, account determination, material valuation, inventory management, invoice verification, material requirement planning, etc.

2. List out the essential components of material management.

·        Determine requirements

·        Source determination

·        Vendor Selection

·        Order Processing

·        Order follow up

·        Goods receipts and Inventory management

·        Invoice Verification

3. What are the benefits or uses of material management?

·        Material valuation

·        Multi-location inventory

·        Bin management

·        The lot and serial traceability

·        Product life cycle management

·        Inventory replenishment

·        Scheduling and resourcing

4. What are the features of material management?

·        Purchasing

·        Production and material control

·        Non-production stores

·        Transportation

·        Material handling

·        Receiving

5. What is material requirement planning (MRP)?

It is a module in SAP enterprise resource planning. It is a type of planning tool to help production and procurement planners to create feasible and realistic plans which helps to quickly initiate procurement and production process.

6. What is consumption-based planning (CBP)?

It is based on past consumption values which makes use of the forecast or other statistical procedures to determine future requirements. It is triggered when the stock level falls below a predefined reorder point or by forecast requirements calculated using past consumption values.

7. What is the difference between MRP and CBP?

In material requirement planning, the prediction of material requirement is based on sales and operations planning while in, consumption-based planning the prediction of material requirement is made, based on historical demand for materials.

8. What is Master production schedule (MSP)?

It is a plan for individual commodities to be produced in each time period such as staffing, production, etc. It is mostly linked with manufacturing in which the plan denotes when and how much of each product will be demanded.

9. What is a planned order in material management?

A planned order is sent to an industry and is a material requirement planning request for the procurement of a particular material at a determined time. It specifies when the internal material movement needs to be made and the amount of material that is demanded.

10. What is production order and purchase order?

A production order determines which material is to be prepared, at which location, and at what time and how much quantity is required. It also defines which components and sequence of operations are to be used and how the order costs are to be resolved.

A purchase order is a formal request or guidance from a purchasing organization to a vendor or a factory to supply or provide a certain quantity of goods or services at or by a certain point in time.

11. What is the process order?

Process Orders (PP-PI-POR) are the central component used for the accurate planning and execution of process manufacturing. A process order represents the production of batches (materials) in a production run or the rendering of services.

12. What is a transaction code in material management?

A transaction code (or t–code) consists of letters, numbers, or both, and is entered in the command field at the top of any SAP GUI screen. Each function in SAP ERP has an SAP transaction code associated with it. You can directly access any function in SAP using t-codes.

13. What are contracts in material management?

A contract is a long-term agreement with a vendor to supply a material or provide a service for a certain period of time. These are specified consequently in release orders issued against the contract when the customer requires them.

14. Define purchase requisition.

A purchase requisition is a primary document which is used as part of the accounting method to launch a merchandise or supply purchase. By processing a purchase order, suitable controls can monitor the legitimacy of purchase, as well as identify the business requirement for the products.

15. How do you create and release purchase requisition in SAP material management?

Purchase requisition creation can be done in T-code ME51N and is a straightforward process:

1.     Execute ME51N transaction.

2.     Purchase requisition document type: NB – standard.

3.     Source determination: ON or OFF.

4.     Header note.

5.     Material: material number.

6.     Quantity and UoM.

7.     Storage location: in which the material is stored.

8.     Vendor: automatically determined by using source determination – field number

9.     Tracking number: covered in previous topics, a desired value can be entered manually

10. Valuation price: copied from material master data if maintained there, if not must be entered manually (if this field is not set as optional).

11. After entering the desired information in the fields, we can save transaction data.

16. What is a special stock in material management?

Special Stocks are the stocks which belong to a company code. These are not placed in any storage location & no physical inventory is performed.

17. Mention the different types of stocks.

A. Valuated Stock

1.     Unrestricted Stock

2.     Quality Inspection Stock

3.     Blocked Stock

B. Non-Valuated Stock

C. Special Stock

1.     Subcontracting

2.     Consignment

3.     Stock Transport Order

4.     Third Party Processing

5.     Returnable Transport Packaging

6.     Pipeline Handling

18. Define consignment stock.

During the consignment process, when a vendor provides material or goods, the company stores it in their stores. The vendor remains the owner of the material until a customer takes it. The liability arises as soon as the material is removed from the stores.

19. What is meant by master data?

Master Data is basically created centrally and is valid for almost all the applications. It remains constant over time but it is required to update it on a regular basis. For example, the Vendor is a type of master data and he is used for creating purchase orders.

20. What is master data management?

Master data management is a comprehensive method of enabling an enterprise to link all of its critical data to a common point of reference. When properly done, MDM improves data quality, while streamlining data sharing across personnel and departments. In addition, MDM can facilitate computing in multiple system architectures, platforms, and applications.

21. What is inventory management?                                                                                                                  Inventory management is used to manage the inventory for the goods. It is based on several key processes. Definition of movement types, reservations, goods issue, and goods receipt.

22. What is movement type and mention a few standard movement types?

<p