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External Refurbishment (Subcontracting) Process Flowchart in SAP MM

External Refurbishment (Subcontracting) Process Flowchart in SAP MM

Picture Description

This flowchart illustrates the external refurbishment process, also known as subcontracting, within the SAP Materials Management (MM) module. The external refurbishment process in SAP Materials Management (MM) is a critical procedure for maintaining the functionality and extending the life of key assets and components. This process involves subcontracting, where materials that require refurbishment are sent to an external vendor. The vendor performs the necessary repairs or refurbishments and returns the improved materials.

The process involves multiple departments and ensures the refurbishment of materials through an external vendor.

  1. Start (Requirement) 🌟: The process begins with a requirement for refurbishment identified by the PM/CS (Plant Maintenance/Customer Service) department.
  2. Create Purchase Requisition (PR) 📝: A purchase requisition is created for the refurbishment requirement.
  3. PR Approval : The purchase requisition undergoes an approval process:
    • If approved, proceed to the next step.
    • If not approved, the process ends.
  4. Create Refurbishment Purchase Order (Subcontracting) 📄: Upon PR approval, a refurbishment purchase order (PO) is created under the subcontracting process.
  5. PO Approval 1st & 2nd Level 🔍: The first and second level of PO approval is obtained.
  6. Material Held for Refurbishment 📦: Goods receipt (GR) from reservation (movement type 961) occurs, and the material is held for refurbishment.
  7. Transfer Posting for Subcontracting Process 🔄: Transfer posting is done for the subcontracting process (movement type 541), holding the material for refurbishment.
  8. Refurbishment 🔧: The material is sent to the vendor for refurbishment.
  9. GR from Vendor (Refurbished Material) 🛠️: Goods receipt from the vendor is processed for the refurbished material. Automatic posting of components occurs (movement type 543).
  10. Invoice Verification 💰: Invoice verification is completed by the finance department.

Departments Involved:

  • PM/CS Department: Initiates the requirement and creates the purchase requisition.
  • Purchasing Department: Creates and manages the refurbishment purchase order, including approvals.
  • Finance Department: Verifies the invoice post-refurbishment.
  • Inventory/Stores Department: Manages the material holding, transfer posting, and goods receipt processes.
  • Vendor: Performs the actual refurbishment of the material.

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