Materials Management (MM)


Efficient material management is crucial for organizations seeking to optimize their supply chain processes. It is also critical to enhance their operational performance. One powerful solution that is instrumental in streamlining material management is the implementation of the Materials Management (MM) module in SAP.

By harnessing the capabilities of SAP MM, businesses can gain better control over procurement, inventory management, and vendor collaboration. This ultimately drives cost savings and improved productivity. 

In this article, we look at the key considerations, processes, and benefits involved in implementing the SAP MM module. The post also sheds light on the transformative potential it holds for organizations

What is SAP MM?

SAP MM (Materials Management) is a module within the SAP ERP system. It focuses on managing materials, procurement processes, inventory management, and vendor relationships. It provides functionalities for purchasing, inventory control, and material valuation. Furthermore, it facilitates integration with other modules for seamless business operations.

Materials Management (MM)

Inclusions of SAP MM Module

The SAP Materials Management or the MM module of SAP encompasses various functionalities. These processes are related to the management of materials within an organization. Here are some of the key inclusions of the Materials Management module in SAP:
SAP MM Modules

Master Data Management: SAP MM involves the creation and maintenance of master data. These records store essential information about materials, suppliers, and purchasing details. 

Purchasing: The purchasing component of the SAP Materials Management module enables organizations to manage their procurement process. It includes functions such as creating purchase orders and managing contracts.

Inventory Management: SAP MM facilitates effective inventory management. It achieves this by providing features for goods receipt, stock transfer, and stock valuation. It allows organizations to track the movement of materials within different storage locations to ensure optimal inventory control.

Warehouse Management: This module of SAP MM focuses on the management of warehouse operations. It includes functionalities such as defining warehouse structures and managing storage bins and locations.

Material Valuation: SAP MM enables organizations to determine the value of materials in inventory. It uses various valuation methods such as standard price, moving average price, and FIFO (First In, First Out). It also supports the valuation of inventory for financial reporting purposes.

Invoice Verification: This functionality involves the verification and processing of incoming invoices from vendors. SAP MM facilitates the reconciliation of invoices with purchase orders and goods receipts. Moreover, it manages invoice workflows for approval and payment.

Material Requirements Planning (MRP): The MRP component of SAP MM helps organizations plan and manage their material requirements. It considers factors such as demand forecasts, production schedules, and inventory levels.

Vendor Evaluation: SAP MM allows organizations to evaluate and monitor the performance of their vendors. It provides tools for assessing vendor reliability and other relevant criteria. This information can be used for vendor selection and ongoing supplier relationship management.

Reporting and Analytics: SAP MM provides a range of reporting and analytics tools. These tools help to monitor and analyze material management processes. It includes standard reports and customizable dashboards that offer valuable insights. These reports assist in making data-driven decisions and improving overall material management efficiency.

These inclusions are just a subset of the comprehensive functionalities offered by the SAP Materials Management module. The module can be further customized based on specific business requirements and industry needs.

Things to consider while implementation

When implementing the Materials Management (MM) module of SAP, several key considerations should be taken into account. Here are some important factors to consider: 

Business Process Analysis

Conduct a thorough analysis of your organization’s existing material management processes. Identify areas for improvement and needs. Align the SAP MM implementation to meet those needs.

System Configuration and Customization

Determine the necessary system configurations and customizations. This may include defining master data structures and setting up purchasing and inventory management processes.

Data Migration and Cleansing

Plan and execute a data migration strategy. Doing so will ensure a smooth transfer of relevant data from legacy systems to SAP MM.

Integration with Other Modules

Consider the integration points between SAP MM and other SAP modules. (which could be Financial Accounting (FI), Sales and Distribution (SD), Production Planning (PP), and Warehouse Management (WM)). Ensure proper data flow and consistency across these modules.

User Training and Change Management

Provide comprehensive training to end-users. Educate them on how to effectively use the SAP MM module. Implement change management strategies to facilitate user adoption and minimize resistance to change.

How BPX will help implement SAP MM?

This section describes how BPX will help organizations implement SAP MM.

As-Is Process (mention list of processes within each module)

BPX plays a vital role in understanding and documenting the existing material management processes. This includes procurement, inventory management, vendor evaluation, etc. This analysis forms the foundation for future process improvements and system implementation.

Business Blueprint (Gap-Fit & To-be)/ SAP functional specification document: BPX collaborates with business stakeholders to identify gaps between the current processes (As-Is) and the desired processes (To-Be). They document these gaps and define business requirements. Finally, they create the Business Blueprint.

Master Data Migration/ Item Master Configuration: BPX assists in the migration of relevant master data. This could include material master records, vendor master records, and purchasing info records. They collaborate with data experts to ensure accurate and complete data migration.

System Configuration / Realization (as per To-Be) along with customization: BPX translates the business requirements captured in the Business Blueprint into system configurations. They work closely with technical consultants to realize the proposed SAP MM system.

UAT: BPX supports the User Acceptance Testing (UAT) phase by providing guidance and expertise to end-users during test scenario creation. They also undertake test execution and issue resolution. They ensure that the SAP MM system performs as expected and meets the defined business requirements.

Go-Live Preparation (update as per feedback during UAT): Based on feedback and findings from UAT, BPX collaborates with the project team. Then they proceed to make necessary updates and refinements to the SAP MM system. They ensure all identified issues and improvements are addressed before the system’s go-live.

Go-Live: BPX actively participates in the go-live activities. They ascertain a smooth transition from the legacy system to the SAP MM system. They support end-users and resolve any last-minute issues.

After Go-Live Support: BPX provides post-implementation support to address any immediate issues that arise after go-live. They assist end-users in adapting to the new system and provide additional training if required. They also work closely with the support team to address system-related issues and optimize system performance.

Thus, BPX contributes to the successful implementation of SAP MM. With careful analysis of existing processes, they provide ongoing support during and after the go-live phase. Their expertise ensures that the SAP MM process flow aligns with business needs. Eventually, the entire process aims at enabling efficient material management processes.


Here are some important questions associated with SAP MM. Let’s take a look:

Material Management in SAP is the module that handles the entire lifecycle of materials within an organization. It encompasses various processes that include the following:

  • Procurement
  • Inventory management
  • Logistics

The system facilitates the availability of materials for production, sales, and distribution. SAP MM enables organizations to effectively manage material master data and streamline procurement processes. It optimizes inventory levels and paves the way for seamless integration with other modules.

SAP MM is used for a variety of reasons. These include the following:

  • Streamlined Procurement
  • Effective inventory management
  • Integrated material planning
  • Enhanced vendor management
  • Accurate financial planning
  • Regulatory compliance
  • Improved operational efficiency

Inventory management in SAP MM includes the processes and functionalities that enable organizations to control their inventory levels effectively. It involves managing the inflow and outflow of materials. It also helps in maintaining accurate stock information and optimizing inventory to minimize holding costs.

The procurement process in SAP MM refers to the activities of acquiring goods/services from vendors to meet an organization’s requirements. SAP MM provides a comprehensive set of functionalities to streamline and automate these procurement processes.

Batch management in SAP MM is the functionality that allows organizations to manage materials based on their specific batches or production lots. It provides a means to identify and distinguish materials produced or received under different conditions. These conditions include production dates, expiration dates, or other relevant characteristics.

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