SAP MM

MM handles the full procurement cycle, purchase requisitions, purchase orders, goods receipts and invoice verification, and manages inventory (stock quantities and valuation) across plants and storage locations. It ensures the business has the materials it needs, procured through controlled processes.

• Purchase Requisition & Purchase Order: requesting and ordering.
• Goods Receipt: receiving stock (updates inventory and posts to FI).
• Invoice Verification: matching invoices to POs/receipts.
• Material Master & Vendor (BP): the key master data.
• Inventory Management & valuation.

MM splits into two halves that are often staffed by different people. Purchasing runs the document chain: ME51N for a requisition, ME21N for a purchase order, ME29N to release one, ME31K for a contract. Inventory runs the movements: MIGO to post them, MMBE to see stock, MB51 to list what happened.

Master data sits underneath both. MM01 for the material, BP for the supplier, and ME11 for the purchasing info record that holds the agreed price for one material from one supplier.

The organisational units decide what a document can do. The purchasing organisation negotiates and owns the contract. The purchasing group is the buyer or team. The plant receives the goods and the storage location holds them. A purchase order that will not save is usually missing one of these or using a combination that has not been assigned.

Tables follow the header and item pattern throughout: EBAN for requisitions, EKKO and EKPO for orders, EKBE for order history, and MATDOC for material documents in S/4HANA.

Half an hour, and it is the exercise every MM interview circles back to.

1. Create a material with MM01, including the purchasing and accounting views.
2. Raise a purchase order with ME21N. Note the account assignment category: blank means the goods go into stock, K sends the cost straight to a cost centre.
3. Receive with MIGO, movement type 101. Stock rises and an accounting document appears.
4. Post the invoice with MIRO. The three-way match compares order, receipt and invoice.
5. Read EKBE through the purchase order history tab. Every receipt and invoice against that line, in one list.

Then repeat step two with account assignment K and watch what changes: no stock, an immediate expense, and a different account. One field, a completely different accounting outcome. See SAP MM configuration for where that behaviour is defined.

MM is central to procure-to-pay: goods receipts and invoice verification automatically post to FI (accounts payable, inventory value) and to CO. It integrates with PP (materials for production) and SD (stock for sales), making it a hub of the supply chain.

The integration that catches people is account determination. Nobody types a general ledger account on a goods receipt: configuration resolves it from the movement type and the material's valuation class. So when finance asks why a receipt posted to the wrong account, the answer is in MM configuration and the material master, not in the ledger. See SAP MM pricing for how the value itself is determined.

• How purchasing organisations map to the business. One central organisation gives negotiating power and a bottleneck. One per site gives speed and fragmented spend.
• Where approval sits. Release strategies on requisitions catch spend before it is committed, which is usually the right place, and on orders when the requisition step does not exist.
• Stock or consumable by default. The account assignment category decides whether something is inventory or immediate expense, and getting the default wrong distorts both the balance sheet and the profit and loss.
• Goods receipt based invoice verification. Stricter matching, more control, and more work when a supplier invoices before delivering.

Once the standard cycle is familiar, the field that opens the rest of MM is the item category on the purchase order line. It changes what the order means.

Standard. Buy goods, receive them into stock, pay for them. The default and the one most people learn.

Subcontracting. You supply components, the vendor returns something made from them. The order carries a component list, and your stock sits at the vendor's site while it is worked on, still owned by you.

Consignment. The vendor's stock sits in your warehouse and remains theirs until you consume it. The goods receipt creates no liability, because nothing has been bought; settlement runs periodically against actual consumption.

Third party. The vendor ships straight to your customer. Nothing arrives at your warehouse, and the receipt is a statistical one recording that the delivery happened.

Stock transport. Moving stock between your own plants using a purchase order, so the movement gets a document, a delivery and proper visibility rather than a bare transfer posting.

Each behaves differently at goods receipt, at invoice and in the accounting it generates, and each is one field on an otherwise ordinary order. When a procurement flow does something the standard cycle does not explain, the item category is the first thing to read.

When a requisition becomes an order, something has to decide which supplier. That is source determination, and it runs through a small hierarchy.

A source list names the allowed suppliers for a material and plant, optionally fixing one. A quota arrangement splits business across several by percentage, which is how a business keeps two suppliers active. An outline agreement, a contract or scheduling agreement, is a negotiated commitment and takes precedence. The info record supplies the price and terms once a supplier is chosen.

If none of these exist, the buyer types a supplier and a price by hand, and the control that the three-way match is supposed to provide becomes a comparison against a number somebody invented.

The practical consequence is that automatic requisition conversion only works where source data is maintained. When a business complains that requisitions are not converting automatically, the answer is almost always a missing source list or info record rather than anything in the conversion program.

Learn MM by following its end-to-end process, its master data, its configuration (in SPRO), and its integration points with finance and neighbouring modules. Hands-on practice in a training system is essential.

• Learning screens, not the end-to-end process.
• Ignoring the finance integration that every logistics module has.
• Skipping master-data setup that the process depends on.

• Learning purchasing and skipping inventory. They are one module and most incidents cross the boundary.
• Not creating info records, so every order price is typed by hand and nothing matches at invoice.
• Reading the purchase order and not its history. See SAP MM examples for realistic cases to practise on.

• Treating the material master as purchasing's alone. Its accounting view decides the valuation, and its sales view decides whether the thing can ever be sold. One record, several owners.
• Closing a purchase order that still has open history. Check the delivery and invoice completion indicators before setting it, or the commitment stays behind.

Running the cycle is the easy half, and configuring release strategies and account determination so it behaves for a real business is the part you do in the course.

The instinct worth building early is to read the purchase order history before forming any theory. It shows every receipt and every invoice against a line, and it is right more often than the person describing the problem.