Warehouse Management (WM) PDF

IT2406 Warehouse Management (WM) A warehouse is a facility for storing goods used by manufacturers, importers, exporters, wholesalers, transport, and customs, among others. SAP Warehouse Management (WM) is a solution to manage standard warehouses, including st...

IT2406 Warehouse Management (WM) A warehouse is a facility for storing goods used by manufacturers, importers, exporters, wholesalers, transport, and customs, among others. SAP Warehouse Management (WM) is a solution to manage standard warehouses, including stock and storage and bin locations management, picking and packing strategies, and shipping. It integrates all the functions of a warehouse and streamlines them. It controls virtually anything that comes and leaves the warehouse and how fast or slow that is. The specific functions of SAP WC include the following: o Manages the structure of the warehouse o Monitors the movement of stock and process their differences o Allows for easy management of potentially hazardous material o Processes all transactions carried in the warehouse o Manages inventory at the storage bin level A warehouse management system such as SAP WM serves as a key component for supply chain management as it offers real-time visibility into an entire inventory in the warehouse and even in transit. WM Organizational Structure (SAP SE, 2022) The organizational structure of SAP WM can be viewed as the following: Figure 1. WM organizational structure. Retrieved from 2022 SAP SE/SAP UCC. Client – an independent environment in the system. Company Code – the smallest organizational unit where a legal set of books can be maintained. Plant – the operating area of a branch within the company. It can be a manufacturing, distribution, purchasing, or maintenance facility. 03 Handout 1 *Property of STI Page 1 of 6  IT2406 Storage Location – an organizational unit allowing differentiation between the various stocks of material in a plant. Warehouse Number – identifies a complex, physical warehouse structure within the warehouse management system. It is the highest level of organizational unit in warehouse management. Storage Type – a subdivision of a complex and physical warehouse. It is idenfied by its warehousing techniques, the form of the organization, or its function. Storage Section – a logical or physical subdivision of a storage type. It also groups a series of similar storage bins. Picking Area – groups storage bins together from the standpoint of picking strategies. Warehouse Door – marks the point where the means of transport change to internal transportation. Allocation Zone – a temporary storage of goods that have just arrived or will be shipped soon. Shipping Point – responsible for the type of shipping, the necessary shipping materials, and the means of transport. Storage Bin – the smallest addressable unit in a warehouse, which identifies the location in the warehouse where goods can be stored. It is the lowest level of organizational structure. WM Master Data (SAP SE, 2022) The master data involved in SAP WM are Storage Bin, Material, Hazard, and Batch. Storage Bin Master Data This master data has two (2) different organizational levels, including warehouse level and storage type level. Warehouse Level contains all indicators and fields valid for the whole warehouse. Storage Type Level contains all indicators that are only valid for specific storage types. A storage bin is the smallest addressable unit in a warehouse. It has three (3) types of data: General Data (Warehouse, Storage Type, Storage Bin Number), Storage Bin Data (Storage Section, Picking Area, Fire- containment Section, Bin Type, Max. Weight), and Status (Blocked for Putaway, Stock Removal Block, Blocking Reason). A quant is the smallest addressable unit of measurement for a material in SAP S/4HANA. It also has three (3) types: General Data (Material, Plant/Storage Location, Batch, Warehouse, Storage Type, Storage Bin), Stock Data (Total Stock, Available Stock), and Block Indicator (Block, Putaway/Removal Status). Material Master It contains all the information a company needs to manage a material. It is used by most components within the SAP system, including Sales and Distribution, Materials Management, Production, Plant Maintenance, Accounting/Controlling, and Quality Management. Hazard Master Data It stores the data concerning hazardous materials such as flammable liquids and toxic and radioactive materials. It includes General Data that specifies the Stroge Class, Water Pollution Class, Flash Point, Aggregate State, Hazardous Material Warning, and Hazardous Substance Number. Batch Master Data It is a subset of material or homogeneous series of unreproducible units with a unique specification. It has different areas wherein information can be specified, such as Basic Data 1 & 2 (Expiration Date, Inspection Date, Trading Data, Administration Data, and Text Data), Classification of Batch, and Material Data. 03 Handout 1 *Property of STI Page 2 of 6  IT2406 WM Process Management and Control (SAP SE, 2022) Here are the different types of Goods Movement in SAP WM. In the Figure 2 example, the goal is to transfer Vendor and Production stocks to their respective storage locations in Plant 2. First, the Vendor and Production stocks are stored in the Storage Location of Plant 1. It can be further stored depending on Stock Type, whether in Unrestricted-use Stock, Stock in Quality Inspection, or Blocked Stock. Then, from Plant 1, it is moved or transferred to Storage Location 1 of Plant 2, and the Production stocks will stay here. Vendor stocks are then transferred to Storage Location 2 of Plant 2 if the stock needs to be released to customers. Figure 2. Goods movement 1. Retrieved from 2022 SAP SE/SAP UCC. A transfer posting occurs during Stock-to-Stock, Material-to-Material, and Consignment-to-Warehouse organizational levels. Once a transfer is done, changes in the stock type and material and batch number of the goods can be observed. In Figure 2, transfer posting is observed in Plant 1. It carries stock-to-stock transfer wherein if goods must be withdrawn from a blocked or quality inspection stock, a transfer posting must be done first to the unrestricted- use stock. The movement type controls between which stock types a transfer posting occurs. A stock transfer can take place at three (3) organizational levels. Storage Location to Storage Location transfer wherein stock is transferred between two (2) storage locations within a plant. Plant-to-Plant transfer wherein stock is transferred between two (2) plants belonging to the same company code. Company Code to Company Code transfer wherein stock is transferred between two (2) plants assigned to different company codes. A stock transfer can be observed in Plant 2 of Figure 1. It utilizes a storage location to storage location transfer. Note that transfer postings should not involve a physical goods movement; however, in stock transfers, there is always a physical goods movement. 03 Handout 1 *Property of STI Page 3 of 6  IT2406 One-Step/Two-Step Procedures Figure 3. One-step/two-step procedures. Retrieved from 2022 SAP SE/SAP UCC. Figure 3 shows two (2) different procedures for Goods Movement. The One-Step Procedure does two (2) steps simultaneously during a stock transfer from the Issuing Organizational Level to the Receiving Organizational Level. It does not use Stock In Transfer and goes directly to Stock of the Receiving Organizational Level. A Two- Step Procedure shows two (2) separate steps during a stock transfer, using the Stock in Transfer this time. Stock Transport Order Figure 4. One-step/two-step procedures. Retrieved from 2022 SAP SE/SAP UCC 03 Handout 1 *Property of STI Page 4 of 6  IT2406 A Stock Transport Order (STO) is a purchase order used to request or instruct a plant to transport material from one plant to another (that is, to affect a long-distance physical stock transfer) within the same corporate enterprise. A purchase order is the same as a stock transport order since these are technically purchased goods from the other plant, but it is a transport because the plants are under the same company code. The stock transport order allows delivery costs incurred due to the stock transfer to be charged to the material transported. Logistics Execution Figure 5. Logistics execution. Retrieved from 2022 SAP SE/SAP UCC Other concepts encountered in WM Process Management and Control: Posting Change Notice (PCN) It is generated by posting change processes in WM-administered stocks. It also has similar functionalities to Transfer Requests which record the information based on the type of change, the purpose of transport, the category of request, and the target system. Transfer Requirement (TR) It is a request to transfer materials at a particular time from a source storage bin to a destination storage bin in a warehouse complex. It represents the expected and scheduled Goods Movement in WM. It is generated by postings in inventory management and consist of a transfer request header and line items. Transfer Order (TO) The central documents for WM. Every material movement requires a transfer order. It has no difference between real and logical movement. The creation of a transfer order depends on its preceding document, such as a transfer request, posting change notice, outbound delivery, or an inbound delivery. A transfer order creation can be manual, direct, and automatic. 03 Handout 1 *Property of STI Page 5 of 6  IT2406 References: Berry, S. & Jaman, A. (2022). Understanding SAP warehouse management vs. SAP extended warehouse management. [Article]. Retrieved on July 17, 2024, from https://clarkstonconsulting.com/insights/sap-warehouse-management/ SAP (2022). What is a warehouse management system (WMS)? [Article]. Retrieved on July 17, 2024, from https://www.sap.com/sea/products/scm/extended-warehouse-management/what-is-a-wms.html SAP Learning (2022). Transfer postings and stock transfers. [Article]. Retrieved on July 18, 2024, from https://learning.sap.com/learning-journeys/explore-integrated-business-processes-in-sap-s-4hana-/transfer- postings-and-stock-transfers_dea6017c-cf7c-4003-b9ff-181d03d7a889 Partner (2022 SAP SE/SAP UCC Magdeburg from Academic Competency Centre) 03 Handout 1 *Property of STI Page 6 of 6