Active ingredient batch management affects all business processes that involve materials containing one or more concentrates or active ingredients. I explain the main steps to be done in the system by the logistics, quality, and financial departments to perform active ingredient batch management processes in SAP ERP Central Component (SAP ECC) 6.0 with the materials management (MM), quality management (QM), and Financials (FI) modules implemented. I show the main master data and customizing details required for this process. Although I use SAP ECC 6.0 to illustrate this process, it also applies to previous versions. In addition to the base and alternative units of measure, SAP offers batch-specific units of measure, which are dynamic alternative units of measure not based on theoretical conversion factors, to satisfy the following business requirements:

• Manage business transactions (in purchasing, production, and sales) that are based on not a theoretical conversion factor, but alternative units of measure that could vary or change for every lot that is produced or purchased. Alternative units of measure, which are based on theoretical material master conversion factors, cannot be changed during the execution of the process. That is because material master conversion factors can be changed only as a part of material master data changes. For example, if you are in the juice business, you probably would work with a base unit of each or pieces and an alternative unit with a fixed conversion factor of kg or ton, in which, for example, 1 piece = 100 kg.

• In a batch-specific unit of measure configuration, you define the base units of measure, the corresponding batch-specific units of measure, and the conversion factor that is to be maintained as a characteristic value in the batch received from purchase or production, thus allowing maintenance of a conversion factor for every batch.

• At the point of goods receipt, conversion of quantities maintained in alternative units of measure based on a conversion factor maintained at the batch-characteristics level is called product unit based batch-specific units of measure.

• Similarly, you also can use batch-specific units of measure to calculate the proportions of ingredients with respect to the base units of measure. For example, 100 mL of a particular batch of fruit juice contain 20 mg of vitamin C and 11.5 g of sugar, as well as the fruit juice proportion. This is called proportion-based batch-specific units of measure.

 

Active Ingredient Management and Business Activities

  Active ingredient batch management is supported in the procurement, production, and sales activities involved in batch management, as seen in Figure 1.     In this process, the buying department has the opportunity to create a purchase order (PO) in MM, specifying an appropriate batch, with ingredient management. This feature is also available to the production and sales departments, respectively, using production or process order and sales order management. I discuss and show in the system the following business activities:

• Maintain active ingredient data for a material
• Create a PO
• Post the goods receipts with reference to the PO
• Display the active ingredient valuation price
• Display the material’s price
• Display the inspection lot
• Conduct quality inspection
• Record the usage decision
• Display the batch master record
• Post the Logistics Invoice Verification (LIV)
• Release the invoice verification
• Check the result in the PO history

Maintain Active Ingredient Data for a Material

To maintain data for a material, you need to update the classification view of the material master AI-1202-01 (a concentrated orange juice that is managed in batch). Follow menu path Logistics > Central Functions > Batch Management > Environment > Material Master > Material > Change > Immediately or use transaction code MM02. Go to the Classification view and make the appropriate entries as shown in Figure 2. Maintain the additional data view for proportion or product units of measure by using transaction code MM02 or following menu path (from the main SAP screen) Logistics > Materials Management > Material Master > Material > Change > Immediately. Go to the Basic Data view and navigate to the Additional Data screen. In the Additional Data screen, select the Proportion/prod.unit tab, specify the appropriate characteristic, and assign a Plan Value within the allowed range for the characteristic. For the proportion/product unit, enter the value AI01, the new proportion unit in which the active ingredient is measured (Figure 3). Define alternative units of measure in the material master’s additional data details. Enter the second line item, as indicated in Figure 4. In the Purchasing view, select the Batch management indicator and populate the Order Unit field with the proportional unit of the batch ingredient. Follow menu path Logistics > Materials Management > Material Master > Material > Display > Display Current or use transaction code MM03. After entering the material code and plant, click the Purchasing tab (Figure 5).   In the next screen (Figure 6) click the Accounting 1 tab and enter X in the Valuation Category field.

  Click the Quality Management tab and maintain the following settings to trigger an automatic inspection lot creation based on a goods receipt against a PO (Figure 7).     Now you create a master inspection characteristic linked to the Class Characteristic AI01. Use  transaction code QS21 or follow menu path Logistics > Quality Management > Quality Planning > Basic Data > Inspection Characteristic > Create (Figure 8). Create the Master Inspection Characteristic MICAI01 referring to an already existing class characteristic AI01. This characteristic is used to evaluate a batch using the Active Ingredient portion. Now create a material specification. Use transaction code QS61 or follow menu path Logistics > Quality Management > Quality Planning > Inspection Planning > Material Specification > Edit (Figure 9). Define the upper and lower limits for the actual value of an inspection characteristic. Create a standard price for batch-specific units of measure. Use transaction code MWB1 or follow menu path Logistics > Central Functions > Batch Management > Batch-specific Units of Measure > Standard Price > Create. Enter the standard price and price unit (Figure 10).    

The batch determination is carried out using active ingredient quantities. The following prerequisites need to be met:

• You have entered the underlying transaction in active ingredient quantities.
• You have set the indicator Display Unit of Measure as a unit of entry in the strategy record.  Do this in customizing. Follow menu path Logistics – General > Batch Management > Batch Determination and Batch Check > Strategy Types > Define Process Order Strategy Types (Figure 11).
• You need to use the standard MM transactions to perform the purchasing cycle for active ingredient management materials. An active ingredient proportion always differs from the actual value of the batch.

   

Create a Purchase Order

Because you can store the PO either in physical quantities (base units of measure) or in active ingredient quantities, enter active ingredient quantities and active ingredient proportion units as PO quantities and order units, respectively. If POs are made in active ingredient quantities, the PO quantity and physical quantity are updated in the PO history. In this way, the degree of PO fulfilment can be determined at any time in active ingredient quantities. All fulfilments are checked against the PO quantity. To create a PO for the material AI-1201-001 that contains an active ingredient measured in the proportion unit I01, use transaction code ME21N or follow menu path Logistics > Materials Management > Purchasing > Purchase Order >Create > Vendor/Supplying Plant Known (Figure 12).     The quantity of active ingredient that is actually delivered may differ slightly from the quantity ordered. Therefore, you need to maintain the tolerances accordingly in the line-item Delivery tab. If needed, specify these details in the Overdelivery and Underdelivery fields as indicated in the Figure 12.    

Post the Goods Receipts with Reference to the PO

  The warehouse department can post the goods receipt for the PO in base units of measure either by using transaction code MIGO or by following menu path Logistics > Materials Management > Inventory Management > Goods Movement > Goods Receipt (MIGO) (Figure 13).       The base unit of measure for material AI-1201-001 is kg. Only the physical quantity can be determined in goods receipt. In this case, 100 kg are delivered. If the active ingredient proportion of the batch is not known at the time of goods receipt, the goods receipt is carried out according to the planned proportion. If the actual proportion is taken from the usage decision in QM, the PO can be subsequently debited. The planned value is used first to calculate the active ingredient content when a goods receipt posting is made in the base unit of measure. In this case, the planned value in the material master for the proportion unit I01 is 50 percent. Therefore, the system first assumes a delivery of 50 I01 was made. Enter a batch number of your choice or accept a number assigned manually. Do not valuate the characteristic active ingredient. You can also display values in proportion units. You can find this function by choosing Goto > Additional functions > Quantity conversion. To display the PO history, use transaction code ME23N or follow menu path Logistics > Materials Management > Purchasing > Purchase Order > Display. On the Item Detail screen, select the tab Purchase Order History. The system displays the goods receipt (Figure 14). The system first assumes that the ordered quantity was delivered (50 I01).        

Display the Active Ingredient Valuation Price

    Because the active ingredient of material AI-1201-001 has its own valuation price, you need to display its valuation record to check that the price for the active ingredient has been updated based on the latest good receipts performed in the system. Use transaction code MWB3 or follow menu path Logistics > Central Functions > Batch Management > Batch-Specific Units of Measurement > Standard Price > Display (Figure 15).        

Display the Material’s Price

  To check that the price of the ingredient management has been updated based on the latest good receipt performed in the system, you can display the average price, standard price, and total stock of the active ingredient material in the Financial Accounting view, in which the valuation type represents the batch level. Use transaction code MM03 or follow menu path Logistics > Central Functions > Batch Management > Environment > Material Master > Material > Display Current. The system displays the price per base units of measure. This price is based on the assumption that the base units of measure contain the same active ingredient proportion as specified in the planned value (Figure 16).      

Display the Inspection Lot

    Upon goods receipt, the system automatically creates an inspection lot. To display the inspection lot (to ensure, for example, that the settings for the QM module have been done appropriately), use transaction code MIGO, specify the material document, and then click the InspLot button, as indicated in Figure 17.       Figure 17 Display the material document and associated Inspection Lot The main details of the inspection lot are reported in the screen shown in Figure 18. The quality management department should process this inspection lot to ensure the materials are available for further use. To get to the screen in Figure 18, click the InspLot button in Figure 17.   (Alternatively, you can use transaction QA03 or following the menu path Logistics > Quality Management > Quality Inspection > Inspection Lot > Processing > Display).      

Conduct a Quality Inspection

  The goods receipt for material AI-1201-001 appears in quality inspection. You should have just measured the potency of the active ingredient. To enter the inspection result, use transaction code QE51N or follow menu path Logistics > Central Functions > Batch Management > Environment > Quality Inspection > Worklist > Results Recording (Figure 19). Select the inspection lots for your material. In the Result field in the data entry section, enter the actual inspected value. (The actual values are usually different from the planned values.) Press Enter to confirm. Save your data.  

Record the Usage Decision

    To record the usage decision, use transaction code QE51N or follow menu path Logistics > Central Functions > Batch Management > Environment > Quality Inspection > Worklist > Results Recording (Figure 20). Double-click the line with your inspection lot in the work list. In the UD code field, use F4 help to enter an acceptance without further action (code A) and save the usage decision.     In this case, the whole goods receipt quantity (100 kg) is to be posted into unrestricted stock, as shown in Figure 21.       During the recording of the usage decision, the system provided the following message: Correct purchase order history for inspection lot using transaction MWBQ. In this step, update the PO history with transaction code MWBQ, as shown in Figures 22 to 24. Use transaction code MWBQ or follow menu path Logistics > Central Functions > Batch Management > Batch-specific Units of Measure > Subsequent Adjustment f. Goods Receipt > Enter with Ref. to Insp. Lot. In the screen that appears (Figure 22), enter the inspection lot number, the document date, and posting dates. Click the execute icon.     After you save the adjustments shown in Figure 23, you receive the status message shown in Figure 24.           To display the updated PO history, use transaction code ME23N or follow menu path Logistics > Materials Management > Purchasing > Purchase Order > Display. On the Item Detail sub-screen, select the Purchase Order History tab (Figure 25). The system displays the goods receipt. The system first assumes that the ordered quantity was delivered (50 I01).        

Display the Batch Master Record

    The characteristics of the batch were valuated in the inspection process with the inspection result from the QM. To display the batch classification, use transaction code MSC3N or follow menu path Logistics > Central Functions > Batch Management > Batch > Display and select the Classification tab. The result from QM has been transferred. The batch has a value that differs from the planned value for the active ingredient characteristic, as shown in Figure 26. Verify that the active ingredient quantity of the batch has been updated.      

Post the Logistic Invoice Verification

    To post the Logistic Invoice Verification (LIV), use transaction code MIRO or follow menu path Logistics > Materials Management > Logistics Invoice Verification > Document Entry > Enter Invoice. Click the Basic Data tab and enter data for the PO document number, invoice date, reference, amount, and tax data as shown in Figure 27. Note that the system accepts the invoice even though the amount specified is higher than planned. This is because of the over-delivery that was posted for the PO. The over-delivery was possible because a tolerance was entered for the PO item. The system responds with a warning message (Figure 28).  

Release the Invoice Verification

    To release the LIV so that it can be paid to the vendor, use transaction code MRBR or follow menu path Logistics > Materials Management > Logistics Invoice Verification > Document Entry > Enter Invoice. Enter the invoice document number and then run the report. The system shows the details reported in Figure 29. The user then selects the line item and clicks the flag icon to release the LIV.  

Check the Result in the PO History

  To display the PO history, use transaction code ME23N or follow menu path Logistics > Materials Management > Purchasing > Purchase Order > Display. On the Item Detail sub-screen, select the Purchase Order History tab. The system displays the goods receipt (Figure 30). The system assumes that the ordered quantity was delivered (50 I01). Verify that the LIV document has been reported on the PO history tab.

 

Customizing Activities

Now I list the most important customizing settings that are necessary to implement the batch ingredient management solution in procurement.

Step 1. Activate batch-specific units of measure. First, activate ingredient management functionality at the client level. Use transaction code OMWS or follow menu path Tools > Customizing > IMG > Edit Project (SPRO). Click the SAP Reference IMG button. In the main customizing screen follow menu path Logistics – General > Batch Management > Batch-Specific Material Units of Measure > Activate Batch-Specific Material Units of Measure. Note that you need to select the Active radio button to ensure that batch management is active (Figure 31).

  Step 2. Create units of measure for proportion unit. To run batch-specific units of measure, a characteristic is required to be added to the batch class that carries the conversion factor for deriving the alternative batch-specific unit of measure. Therefore, you must create this unit of measure before proceeding. If this unit of measure already exists in the system, then continue to the next step. Create the non-dimensional unit of measure that is used as a unit of measure for the characteristics. Use transaction code CUNI. To create a unit of measure for your active ingredient that should act as a proportion unit of measure, follow customizing menu path Tools > Customizing > IMG > Edit Project (SPRO). Now follow menu path SAP NetWeaver > General Settings > Check Units of Measurement. Click the Units of Measurement (no dimensions) button. In the screen that appears, enter transaction code CUNI and click the create icon . In the next screen (Figure 32) enter the details for the unit of measure for your active ingredient that should act as a proportion unit of measure.    

Step 3. Create units of measure for the ratio unit. Create another unit of measure (non-dimensional) for the ratio between the physical quantity and the active ingredient quantity. Follow menu path Tools > Customizing > IMG > Edit Project (SPRO). Click the SAP Reference IMG button. Now follow menu path SAP NetWeaver > General Settings > Check Units of Measurement. Click the Units of Measurement (no dimensions) button. In the next screen choose Create. The next screen that appears (Figure 33) includes the details of the unit of measure for the ratio unit.

   

Step 4. Define the proportion unit. Assign the units of measure from the role of proportion units of measure (Figure 32). Enter the units of measure in the table of the batch-specific material units of measure. Search for an appropriate reference unit of measure with the dimension mass. Follow menu path Tools > Customizing > IMG > Edit Project (SPRO). Click the SAP Reference IMG button. Now follow menu path Logistics – General > Batch Management > Batch-Specific Material Units of Measure > Edit Batch-Specific Material Units of measure. You also can use transaction code BMA1.

Make a new entry for the unit of measure I01. It should be able to be used as a batch-specific unit of measure. Enter the dimension Mass as the reference unit of measure (Figure 34).     Step 5. Define a ratio unit of measure (i.e., calculate the proportion unit from the base unit). First, define the relationship between the active ingredient (proportion unit) and the physical quantity for the units of measure. Use the proportion unit and the base units of measure KG defined in Figure 34. This data helps the system convert from the base units of measure to batch-specific units of measure. Similarly, you also can configure the conversion of batch-specific units of measure to base units of measure. Follow menu path Tools > Customizing > IMG > Edit Project (SPRO). Click the SAP Reference IMG button. Now follow menu path Logistics – General > Batch Management > Batch-Specific Material Units of Measure > Calculate Proportional Factors > Define Calculation of Proportion Quantity from Base Quantity or use transaction code BMA3. Choose New Entries. Enter the commercial format, batch-specific units of measure, and base unit of measure information, as shown in Figure 35. Step 6. Create the conversion factor characteristics for the batch class. Use transaction code CT04 and assign the same to the batch class of the product that requires the batch-specific conversion. Assign the unit of measure created in step 3 – Batch Specific conversion factor unit of measure  (Figure 33). For example, you can create characteristics called AI01 with a description Active Ingredient with unit of measure U01. The characteristic that you create needs to be in a numeric format and it cannot carry multiple values. All the data you need to define for this characteristic is defined in Figures 36, 37, and 38. Enter the values as listed in Figures 36 and 38 and specify the appropriate characteristic values in Figure 37. Define the basic data for the characteristic AI01, Figure 36.

Define the appropriate value range for the characteristic’s values (Figure 37).

Assign class type 022 and 023 to the characteristic AI01 (Figure 38).   Step 7. Assign the conversion factor characteristics to batch class. Use transaction code CL02 and assign the characteristics (conversion factor characteristics) to the batch class, as shown in Figures 39 and 40. In addition to assigning the characteristics to the class, you also must classify the batch class at the header as a Special Batch Class by entering a value S (Substance Steel) in the class header of the field Organizational Area (Figure 39). You also include the value S for the characteristics in the screen in which you list the characteristics of the class (the Characteristics tab of the Class Change transaction) as shown in Figure 40. This step ensures that the system uses this characteristic in carrying out the batch-specific units of measure functionality.