This post is the first one of a series of articles that I am planning to write about SAP Enterprise Structure in the Material Management (MM) module’s point of view. Due to its integration with other modules, I will also explain about some Enterprise Structure organizational units in Financial Accounting (FI) and Sales & Distribution (SD) modules.
Actually, I have published this series of posts as an e-book that is sold at SAP Study Materials Store. From now on, I am planning to write the e-book contents on this blog so you can read them for free. But I will write them in a series of post on this blog (could be 20 posts). If you haven’t registered to our feed, you can do it now, so you’ll be notified every time I post the new article on this blog: Continue reading
Purchasing Organization is an organizational unit in Purchasing of MM module.
Purchasing Organization is an organization unit that has responsibility to company’s purchasing activities, such as create Request For Quotations (RFQ), Contract, Purchase Order (PO), etc. aIt negotiates purchasing conditions (price, discount, term of payment, etc) with vendors. A Purchasing Organization is represented by a client-unique 4-digit alpha-numeric.
A purchasing organization must be assigned to one (in the case of plant-specific purchasing) or more plants.
One plant can have one or more Purchasing Organizations.
A purchasing organization can be assigned to one company code (in the case of company-specific purchasing).
SAP SD Enterprise Structure
Enterprise structure or Organizational structure in SAP is a structure of SAP organizational units that reflects the structure of the business in the real world. There are various SAP organizational units that can be mapped to business structure based on the real world business requirements such as: Client, Company Code, Plant, Storage Location, Sales Organization, Distribution Channel, Division, Sales Office, Sales Group, Sales Person, Shipping Point, Loading Point, etc.
We must set the enterprise structure correctly in the first place. The change of it usually requires a great effort and very time consuming. To set it up correctly we must have a comprehensive knowledge about the business processes and how to map it to SAP configuration.
A specific organizational unit is defined by a specific function or module in SAP. Company code is defined by FI module. Plant is defined by Logistics function. Storage Location and Purchasing Organization are defined by MM module.
In SD module we have to define Sales Organization, Distribution Channel, and Division. We have an option whether to use Sales Office, Sales Group, and Sales Person or not.
Step by step SAP Material Management (MM) Configuration: Assign Purchasing Organization to Company Code and Plant
Purchasing Organization is an organization unit that has responsibility to company’s purchasing requirements. It negotiates purchasing conditions (price, discount, and other things) with vendors.
We can assign Purchasing Organization to a company code if we want a Company-specific purchasing. The purchasing organization may procure only for this company code. Then, we assign only plants of the company code concerned to the purchasing organization.
You can read our previous post to understand more about Purchasing Organization in SAP Enterprise Structure.
In this example we will assign “GC00” Purchasing Organization to “GC00” company code and to “GC01” plant. We can do this in a SAP R/3 client with T-code: SPRO. SAP step-by-step Screen shots of How to assign a Purchasing Organization to company code and plants are: Continue reading
Step by step SAP Material Management (MM) Configuration: Maintain Purchasing Organization
Purchasing Organization is an organization unit that has responsibility to company’s purchasing requirements. It negotiates purchasing conditions (price, discount, and other things) with vendors. You can read our previous post to understand more about Purchasing Organization in SAP Enterprise Structure.
We can define Purchasing Organization in a SAP R/3 client with T-code: SPRO.
SAP step-by-step Screen shots of How to maintain a Purchasing Organization are:
- Go to the menu: IMG – Enterprise Structure – Definition – Material Managements – Maintain Purchasing Organization: Continue reading