Material Management for process industry

[Former Member]

Hi All,

this is senthil palaniappan from india.i am working for an oil company, we are in the project stage. my corporate is planning to have a centralised financial system, for that we have decided to implement SAP.

Since we are in project stage, we have planned to implement only 2 Modules.

1.Material Management

2.FICO

our project is very unique in the world since we are gonna have relocated refinery.

I came to know that Conventional material mangement of SAP would not cater to the Material Management of Process industry like refinery!

I will be very hapy if anyone could explain me how its different from traditional material management of SAP?

Senthil Palaniappan

[Former Member]

Hi

In OIl industries, the various losses are to be addressed like when Oil moved from the refinary to the filling station and filling station to dealer etc, there will be evaporation and other losses will be there.So there will difference in loading weight and unloading weights.All these variances are to be addressed properly and if not it will have impact on financials.

SAP came with Industry specific packages like IS-OIL etc with which you can map 100%.

Regards

Ramakrishna

[Former Member]

Hi

From the materials management prospective, there is no big change compare it to a normal discrete manufacturing or a process Industry.

However, few of the functionalities like, procurement using Pipeline, etc could be an additional requirement in your case (I am not sure whether it is really applicable or not).

Otherwise functionality level, there is no big difference between process industry and conventional discrete manufacturing.

Regards

Jagadeesh

[Former Member]

Thanks Jagdeesh,

Again thanks for the reply. our SAP implementation is not for a running refinery. its in project stage.

let me explain the problem.

our is a relocated refinery from germany. i mean its a second hand refinery.we have carried out refurbishments and revamps for some of the equipments.

our centralised financial system should track each and every item .I mean this module is going to be usefull in construction and commission of a refinery.

we had implemented SAP 4.0B earlier, but it was utter failure due to some of the incapabilities of the module ,like they had implemented MM,PS,FICO.

if some material procurement is delayed against the set time , the shift in the delivery should have a right impact in the financial system.

they were not able to solve this with SAP 4.0B.

Also, SAP 4.0B was not supporting multi currency then.

with this situation Could anyone explain me which SAP version will be able to solve this problem and how it differs from conventional material management module ?

[Former Member]

Hi,

You need to be on 4.6 as a very minimum and even this will be out of date soon and so you should aim for ECC6 (ERP2005).

SAP is more than capable of handling process industries and within PP it is split down to PP and PP-PI (Process industries).

I have personally been involved in two implementations in the checmical industry and I am currently working in the GAS and Oil industry. None of these implementations have experienced any gaps in the SAP functionality that cannot be handled easily.

So I am surprised to here the comments that you think that it cannot handle a refinery (reconditioned or otherwise).

I would suggest that you try to find a reference site (i.e. a company that is similar to yours) that has implemented SAP. I am sure that you will find that there are no gaps that cause any significant problems.

I am a VERY strong supporter of the SAP system and its capabilities to handle even the most extreme requirements. Please do give it a CLOSE examination before you assume that it cannot cover your requirements.

If you have any specific requirements that you think it can't accomodate then please do post them here and we will try to explain the options available.

Steve B

[Former Member]

Hi

Right now I am on a implementation project and here we are using PS and PP solutions to address the problems highlighted by you. Although the situation is different, the basic scenario appears to be similar.

I am sure, with proper business mapping it possible to have standard solution through SAP. I think, you might have to use PS for your construction and commissioning of the refinery. Whereas for your production activities, you may choose to use PP-PI. However, it is not correct on my part to give such opinions without actually understanding the business scenario.

To summarize, SAP definitely will give you all required solutions for your requirements and it is very important that proper business mapping is carried out to have solutions.

Regards,

Jagadeesh