Greetings! I am currently crafting a case study centered around a particular issue. I am eager to get insights from an SAP expert concerning the ensuing problem within the SAP framework.
Company Process Overview:
XYZ engages in the procurement of raw materials from suppliers, with these materials finding residence at the premises of the third-party logistics provider, ABC. Whenever XYZ necessitates a specific product, they initiate a transfer order (Storage to Storage) and transmit the order via email to ABC. Subsequently, ABC undertakes the delivery within a single day.
Problem 1: Inconsistent Procurement and Inventory Recording
XYZ initiates a purchase order for Material Number 1234, specifying a weight of 10 kg and dimensions of 2m x 2m x 2m, with a unit weight of 2kg/piece.
The supplier dispatches 5 pieces of the material, collectively amounting to the requested 10 kg, aligning with the purchase order.
Within the ERP system of ABC (the third-party logistics provider), this material is registered as Material Number LL 222 DB, incorporating the lower length and company name and dimension.
A subsequent purchase order is placed by XYZ for the identical material (1234), but this time seeking 13 kg. However, the supplier provides a variant with dimensions of 3m x 3m x 3m, accompanied by a unit weight of 3kg/piece. The rest of things are the same that’s why XYZ accepts the delivery e.g. Chemical composition, mechanical composition, Hardness, etc.
In order to fulfill the 13 kg requirement, the supplier delivers a total of 15 kg (3kg/piece * 5 pieces).
Despite this, XYZ records a goods receipt (GR) for 13 kg, Reason may be a lack of communication, Human error.
Subsequently, owing to the variation in dimensions, ABC introduces a new material record, designated as ML 333 DB, within its ERP system. Consequently, two distinct materials coexist for the same item, namely 1234.
Material Stock Overview:
XYZ: Material 1234, Total: 23 kg (10 kg + 13 kg)
ABC: LL 222 DB - 10 kg
ML 333 DB - 15 kg (Total: 25 kg)
Problem 2: Transfer Order Inaccuracies and Inventory Discrepancies
XYZ generates a transfer order for 7 kg of the desired material.
Regrettably, due to negligence concerning weight per piece, XYZ fails to accurately specify the required quantities.
Notably, since ABC cannot divide the material, they convey 3 pieces of Material LL 222 DB, resulting in a total of 6 kg (3 pieces * 2 kg/piece).
Consequently, the inventory record demonstrates a deviation: XYZ - 17 kg and ABC - 19 kg.
Problem 3: Bulk Warehouse Inventory Count Disruptions
Furthermore, an additional quandary pertains to XYZ maintaining ABC's warehouse as a bulk storage facility within its SAP system. During the physical inventory count, disparities emerge, necessitating a recount of the inventory. Unfortunately, due to the bulk storage nature, every material must be recounted, culminating in a cessation of operations between XYZ and ABC. This setback translates to a substantial loss of time. Moreover, instances may arise where ABC holds two distinct materials against XYZ's single material, further complicating the situation.
What would be a best solution or best process to eliminate bottleneck from the company’s SAP system?
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