August 27, 2013

Material Master Design Workshop

2
Workshop Objectives
Current State
Material Master creation process
Material Type controls
Required Views by Material Type
Current ZSTK Data Issues
Future State
Field level discussion
Suggested Reports
POVs for Specific Fields
Next Steps



Agenda
3
Understand National Grid current material master processes for each material type
Discuss and document pain points and opportunities
Discuss field based requirements for each material type
Discuss future reporting needs
Identify and capture Governance, Security and Control requirements
Workshop Objectives
Current State
Material Master Creation Process
5
Material
Requestor
LOB
Manager
IMWM
Analyst
Buyer
IMWM
Director
Finance TDC
Receives automated notification of
request
Performs review of request for
fit and function
Provides additional
information necessary for
record maintenance
User
completes
Master
Data
Request
Form via
Communi-T
Receives forms for
Create only
Performs
reviews
according to
strategic
functions and
needs
Approval Workflow Form Request Data Entry
Receives a
complete and
descriptive
Communi-T
Form and
loads into
SAP
Material Type Controls
6
Number assignment
Procurement Type
User departments
Field selection
Account determination
ZSTK (Inventory
Materials)
ZCAP (Pre-Capitalized
Materials)
ZBLS (Billing Services
Materials)
ZNST (Non Stock
Materials)
ZNBW (Non Valuated
Materials)
ZMPN (MPN Materials)
Control
7
Current State
Required Views by Material Type
Data Level ZBLS ZCAP ZSTK ZNST ZNBW ZMPN
Basic Data
and
Classification
Basic Data 1 X X X X X
Basic Data 2 X X X X X
Classification X X X
Sales Data
Sales org. data 1/2 X X X X
Sales/ General
plant Data X X X X
Foreign Trade
Export Data X X X X
Sales Text X X X X
Purchasing
Purchasing X X X X X
Foreign Trade
Import data X X X X
Purchase order
text X X X X X
MRP,
forecasting
MRP1, 2,3,4 X X X
Forecasting X X X
IM/WM
General Plant
Data1/2 X X X
WM view 1/2 X X
Accounting
Accounting 1/2 X
ZSTK Design:
All views are maintained for ZSTK material
type
There are several views which have no data
maintained and are active for ZSTK material
type
Activating these views allows for incorrect
data to be maintained in the material master
Recommendation:
Review which views in the material master
should be active for ZSTK material creation
Current ZSTK Data Issues
8
Material Master Data Issue Business Impact
Material short text is incorrect/ incomplete Allows duplicates and data inconsistency in system
Materials with same MPN and MNFR Indication of duplicate materials in the system, unable to
use material search functionality
Missing Purchasing Group Unable to determine which buyer group should process
purchase order
MRP Type Relevant Missing Planned Delivery Time Delivery Date on Purchase Orders must be entered
manually
Listed below are some of the critical material master data issues which were identified as part of the
data remediation effort prior to project kick-off:
Future State
Field Level Discussion
10
Material Master View Field Category Discussion Points
Basic Data
Short Description Duplicate Short Description
Long Description Data Updates and Duplicate Check
Material Group Material Group Structure
Material Classification Classification Structure
Purchasing
MPN/MNFR Duplicate MPN/MNFR
MPN Profile MPN/MNFR search capability and CR
Purchase Value Key Tolerance Limit on GR
Purchasing Group Purchasing Group Structure
GR Processing Time Capture warehouse processing time
MRP 1
MRP Type Different MRP Types used
MRP Controller Required for relevant MRP Type
MRP ABC Indicator Ranking materials by MRP priority
Lot Size Matching lot size with contract amount
Safety Stock Inventory Stock outs
Planned Delivery Time Manual entry on PO if not required
Suggested Reports
11
Reports Description
Materials on Expired Contracts
This report will list materials which exist on contracts with an end date in the
past or upcoming (within one month)
Materials Multiple Contracts List of materials which exist on more than one contract
Material Extension Report List of materials missing plant and/or storage location data
Duplicate Material Check List of possible duplicate materials based on key fields
Material Usage Report Shows whether material has been used in purchasing over the last six months
POVs for Specific Fields
ZSTK Material Short Description
13




Material Description Number of Occurrences
ORNG, 121
BRG, 110
BRG, BALL 88
PCKNG, VLV 82
BRD, PRNTD CIR 78
Impacts:

Buyers unsure of which material to select for
purchasing
Search functionality for materials is significantly
more difficult
Incorrect materials procured
Potential for duplicate materials to exist in the
system

Recommendation:

Standardized material short description conventions
need to be developed and loaded into SAP
Refer to legacy naming conventions to improve
short description quality



Currently, there are 4000+ active ZSTK materials which have duplicate short descriptions in the system,
the top 5 duplicated descriptions are shown below:


Material Long Description
14
Currently the Material Long Description is being used to store the most up to date purchasing information
in the material master including:
Detailed description
MPN
MNFR






This field must be included in the process of checking for duplicate materials as the short description and
the MPN number do not have the necessary data quality

However, the Long Description is not stored in an SAP table, making the duplicate material check
extremely difficult

If data quality is improved in the short description and MPN fields, duplicate material checks can be
carried out much more simply without the use of the Long Description












Material Classification
15




Classification of material aids in searching for materials, but there are 9 characteristics in generation
class but only 3 of them are used




Impacts:

Material reporting based on material classification
will not be complete
Search functionality for material will be restricted to
the three classification values

Recommendation:

Review the current classification structure for
opportunities to provide more characteristic data for
materials







Material Manufacturer/Part
Number
16




MPN Manufacturer Number of
Occurrences
136273 9100001944 262
134441 9100002703 136
136511 9100003799 119
136267 9100001777 105
1195678 9100003073 105
Impacts:

Search functionality for materials is significantly
more difficult
Potential for confusion when communicating what
material is needed on the PO

Recommendation:

Determine root cause for duplicates and cleanse
data
Create validation to warn user of potential duplicate
when creating new material


Currently, there are 6000+ active ZSTK materials which have duplicate Manufacturer/Part Number in the
system, the top 5 duplicated descriptions are shown below:



Material Purchasing value key
17




Impacts:

No system control over how much warehouse can
receive
Errors in warehouse receipt process are more likely
Quantity received can differ from expected quantity,
negatively impacting planning process

Recommendation:

Agree to an acceptable over delivery tolerance and
implement it in material master


Nearly all Materials have been created to allow unlimited over delivery. There are also no reminders or
under/over delivery tolerance maintained.

Material Purchasing Groups
18




Issues with Purchasing Group Design and Use:

Currently, there are 117 Purchasing Groups configured, however only 104 have been used in purchasing

4 Purchasing Groups have a description of Buyer (see right)


Multiple users have created purchase orders using one purchasing group. This does not match the
purchasing group design (one purchasing group per user)


Recommendations:

The unused purchasing groups should be deleted

Purchasing Group descriptions should be updated with more detail to ensure that incorrect purchasing
group data is not used on POs

A standard policy needs to be set to determine what users are assigned to each purchasing group
MRP Type
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MRP Type MRP Description # of Materials
ND NO MRP 139,677
Z1 Auto ROP + ARQ Only 1
ZC Auto ROP + Demand in LT 2
ZH Manual ROP + Demand 2
ZI
Manual ROP + Demand in
LT 16,494
ZJ Min/Max Only 42,547
ZM Capacity Planning 295
ZN Demand Only 16,879
ZO Demand only in LT 24
There are 9 different MRP types configured in the system, three of these MRP types are used only for 1
or 2 materials (in plants):
Impacts:

The materials using these MRP types may be
incorrectly planned
These MRP types may be used incorrectly for new
materials created in the system


Recommendation:

These three MRP types should be evaluated for
necessity and deleted if obsolete



Next Steps
Next Steps
21
Continue discussion on remaining material types

Review and align on future state design for material master

Identify and finalize design objects to achieve future state
Appendix
Material Classification Details
23
General Inventory Class Generation Class
25 Characteristics assigned to General
Inventory Class
9 Characteristics assigned to Generation
Class
Most of the characteristics have no values
assigned in the material master Need
Clarity
6 Characteristics have not been used so far