The different Inventory Management Modes in SAP Digital Manufacturing
An efficient inventory management ensures optimal resource utilization, minimizes waste, and improves overall productivity. SAP Digital Manufacturing (DM) offers a flexible way to manage inventory in integration with SAP S/4HANA, SAP S/4HANA Cloud, and SAP ERP.
In this blog post, we will explore the different inventory management modes available in SAP DM, which can provide an efficient approach to handling ERP stocks.
Inventory Management Modes in SAP DM
SAP DM supports two inventory management modes for ERP stocks:
- Individual Mode: A fine-grained strategy that creates an individual inventory record for each goods movement event and updates the stock quantity accordingly.
- Consolidated Mode: A more detailed strategy that uses snapshot-based inventory replication, aggregating inventory records based on specific business keys and updating the stock quantity only when stock snapshots are retrieved from integrated ERP systems.
You can configure the desired inventory management mode (individual or consolidated) for your plant in the Inventory Management Settings section within the Manage Business Settings app in SAP Digital Manufacturing. This app provides a centralized location to manage various business settings, allowing you to tailor the inventory management approach to suit your plant’s specific requirements and preferences. By choosing the appropriate mode, you can optimize your inventory management processes and better align them with your overall manufacturing operations.
- Inventory management modes are only intended for ERP stocks created and consumed in integration with SAP S/4HANA and SAP S/4HANA Cloud and SAP ERP. They do not apply to EWM stocks, or manually received DMC stocks.
- The consolidated inventory management mode is a beta feature and is supported with SAP S/4HANA 1709 version or higher.
Consolidated mode offers several advantages, including the ability to consolidate multiple stock records into a single inventory record based on certain business keys. This not only simplifies inventory management but also reduces the number of individual records created in the Manage Floor Stocks app.
Business keys used for aggregation in consolidated mode include plant, storage location, material, batch, stock type, and reserved order. If certain business keys are unavailable for some inventory records, only those records with identical business key values will be aggregated into a single record.
Restrictions and Limitations
When using consolidated mode, be aware of the following restrictions and limitations:
- Irreversible mode switch: Once you switch to consolidated mode, you cannot revert to individual mode.
- Serialized materials: Serialized materials are not supported in the consolidated mode, as they may cause quantity inconsistencies.
- Stock types: Only Unrestricted-Use Stock (01), Stock in Quality Inspection (02), and Blocked Stock (07) can be transferred from integrated ERP systems to SAP DM.
- Standard goods movement types only: Customized goods movement types are not supported.
- Inventory by SFC: Unable to inventory records based on SFCs in the Work Center POD and Operation Activity POD.
- Plant conversion: Plant conversion is supported for integration with SAP ERP, but not for SAP S/4HANA and SAP S/4HANA Cloud.
Before using the consolidated mode, ensure the following prerequisites are met for your plant’s integration with SAP S/4HANA or SAP ERP:
For SAP S/4HANA integration
- The collaboration link COLLABORATION_CONSOLID_INV_READ_ERP_OP is mapped to the collaboration directive ERP_CONSOLID_INV_READ_OP in the Manage Collaboration Links app.
- You have enabled direct communication to SAP S/4HANA. For more information, see Enable Direct Communication To SAP S/4HANA.
For SAP ERP integration
- The collaboration link COLLABORATION_CONSOLID_INV_READ_ERP is mapped to the collaboration directive ERP_CONSOLID_INV_READ in the Manage Collaboration Links app.
- The material must be configured as MRP material in the integrated ERP system.
By ensuring these prerequisites are met, you can effectively use the consolidated mode for inventory management in SAP DMC when integrated with SAP S/4HANA or SAP ERP.
In contrast to the consolidated mode, the individual mode in SAP Digital Manufacturing (DM) provides a fine-grained approach to inventory management. This mode creates a unique inventory record for each goods movement event, ensuring detailed visibility into inventory changes and stock movement activities.
Key features of the individual mode include:
- Detailed inventory tracking: The individual mode allows you to track each goods movement event separately, providing complete visibility into your inventory transactions. This can be beneficial for organizations that require a high level of granularity in their inventory management processes.
- Inventory by SFC: In the individual mode, you can select inventory records based on Shop Floor Control (SFC) in the Work Center POD and Operation Activity POD. This enables you to associate specific inventory transactions with particular SFCs, allowing for better traceability and control over production processes.
While the individual mode offers detailed inventory tracking and greater granularity, it may result in a higher number of individual records in the Manage Floor Stocks app.
Depending on your organization’s needs, you might prefer the more streamlined, aggregated approach provided by the consolidated mode. When selecting an inventory management mode, consider the trade-offs between granularity and simplicity to determine the best fit for your specific requirements.
To summarize, in the individual mode, each stock receipt type generates a unique inventory record with an inventory ID. In contrast, the consolidated mode creates a single inventory record for several stock receipts, based on the business keys mentioned earlier.
In conclusion, SAP Digital Manufacturing Cloud offers two powerful inventory management modes to handle different business requirements.
The individual mode provides detailed inventory tracking and a high level of granularity, allowing you to closely monitor each goods movement event and maintain comprehensive visibility of your inventory transactions.
On the other hand, the consolidated mode simplifies and streamlines inventory management by consolidating multiple stock records into a single inventory record based on specific business keys. Both modes have their unique advantages and choosing the right mode for your organization depends on your specific operational needs and priorities.
By carefully evaluating the trade-offs between granularity and simplicity, you can select the most suitable inventory management mode to enhance your overall operational efficiency and improve your manufacturing processes.
Do you like this post? Please let me know in the comments section what you think. Any feedback is highly appreciated.
Or, if you have any questions, please check SAP Community Q&A Area, or comment down below.