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A Simple Method To Efficiently Improve a SAP Driven Supply Chain

WinnerIn one of my latest articles – “SAP Supply Chain Monitoring Best Practises” I spoke about a Supply Chain Executive’s winning formula.

Included in that winning formula is #2

          • Maintain strategic focus
            • Define Key Initiatives & Metrics.

I would highly recommend re-reading that article as this one builds on it.

What astonishes me is how many companies do not use standard SAP reporting to measure key metrics. SAP provides up to 300 exceptional standard reports and lists to extract key data metrics. More often than not, there is no need to program complex reports or use sophisticated Information Cubes and Business Intelligence.

I’m going to save you plenty of trouble by listing a few fundamental SAP standard reports you can use right now.

I’ve also included transaction MD04 as the best SAP tool to monitor a SAP Supply Chain real time.  Once again I’m astounded at the limited use this tool gets.

Inventory Monitoring

  • MM – MD04 – THE supreme real-time supply chain monitoring tool. Be proactive or constantly struggle being reactive.
  • MM – WPDTC – adjust actual vendor lead-times and align them with your master data.
  • MM -MC50 – identify dead stock and calculate dollar values and cost.
  • MM -MC46 – identify slow moving items and calculate dollar values and cost.
  • MM – MC44 – calculate inventory turnover and compare to your inventory KPI.
  • MM – MC$4 – Purchasing values by vendors, and so much more.
  • MM – MC$6 – Detailed Lead time analysis for on-time delivery.
  • MM – MCE1 – Purchasing values by individual buyers …who does what?
Production Planning
  • PP- MCPU, MCPF and MCP7– Production Target deviations (delivery, lead-times, quantities…etc.) by Material, Order, Plant, Date and work

Center.

  • PP- MCPO – Production quantity variances.
  • PP- KKBC_HOE – Product costs.
Quality Management
  • QM – MCXX, MCVX, MCOX – Quality defects at notifications/ material / vendor / customer levels.
  • QM – MCXV – Quality notification overview.
Plant Maintenance
  • PM – MCI8 – Plant Maintenance Costs.

There you have it. After running these reports and aligning the information with your Supply Chain KPI’s you can now do the following

Create Supply Chain Monitoring metrics that are simple and transparent.

  • Begin extracting data from one source of truth.
  • Use data to create a Supply Chain Plan that is easily remembered and communicated.
  • Plan key initiatives across the Supply Chain to reduce costs and bottlenecks.
  • Avoid additional testing from custom reports when upgrading service packs.

Terry Vermeylen is hell bent on rapidly transforming your business into a World Class Operation by major transformation or by eliminating one bad habit at a time.

Terry Vermeylen brings 30+ years of experience in SAP and Supply Chain Process improvement. As an SAP professional and Supply Chain Architect he has worked and consulted for some of the world’s largest and most successful manufacturing companies focusing primarily on the Aerospace and Pharmaceutical industries.

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