SAP CO Product Costing"STEEL Manufacturing Process"-S/4 HANA

SAP CO Product Costing"STEEL Manufacturing Process"-S/4 HANA udemy course free download

Steel mfg process includes MTS, MTO, By & CO products ,Mixed Costing, Multi Special Procurements(STO & Withdrawal)

Steel manufacturing involves a plethora of steps, and product costing for this industry is intricate. SAP CO provides the necessary tools and functionalities to enable accurate product costing, aiding steel manufacturing enterprises in efficient costing processes.

Let's elaborate on the SAP CO implementation for product costing in the steel manufacturing sector:

1. SAP Implementation in Steel Industry: Implementing SAP in the steel industry requires an in-depth understanding of industry-specific processes. The complexity of the steel manufacturing processes requires a tailored SAP solution to ensure that the processes are efficiently mapped and executed in the system.

2. Course Structure: This course, beneficial for consultants aiming to implement SAP in the steel sector, should be structured with practical live scenarios, taking into account industry best practices and the specific nuances of steel manufacturing.

3. Manufacturing Processes in Steel Industry:

• Iron Making:

  • Iron ore, limestone, and coke are processed in a blast furnace to produce sinter.

  • Sintering is a vital process as it provides a rich raw material for iron making while reducing waste.

  • Coke, produced from different grades of coal, acts as a reducing agent in the blast furnace.

• Primary Steel Making:

  • The produced hot metal is then combined with scrap steel.

  • Two primary processes are:

    • Basic Oxygen Furnace (BOF): Uses hot metal from the blast furnace and steel scrap. This is a widespread method.

    • Electric Arc Furnace (EAF): Uses Direct Reduced Iron (DRI) and scrap metal. This method is increasingly becoming popular due to its environmental benefits.

  • Depending on the client's requirements, mixed costing processes might be utilized, combining both BOF and EAF methods.

• Secondary Steel Making:

  • This process forms SLABS, BILLETS, and BLOOMS, which are fundamental materials used in various applications.

4. Month-end Closing in Costing:

• F-02: Book all the financial expenses to a common cost center. This captures all costs, ensuring they are allocated in subsequent steps.

• KB31N: Enter statistical key figures (SKF) data for production cost centers, which aids in accurate overhead allocation based on actual production data.

• KSU1: Create assessment cycles. These cycles define how internal costs are distributed among various cost objects.

• CPTD: Allocate actual overheads using templates. This ensures overheads are distributed based on predefined standards or patterns.

• KSU5: Run the assessment cycle. This step allocates the costs from sender cost centers to receiver cost objects based on the rules defined in the assessment cycle.

• KSS2: Split costs based on activities. This distributes costs based on actual activity consumption.

• KSII: Calculate actual activity rates. This updates the plan rates with actual rates, providing more accurate costing.

• CON2: Revaluate orders based on the updated rates. This ensures that order costs are aligned with the most recent costing data.

• CO8B: Settle the costs of co-products. Co-products often share production costs, and this step ensures that costs are distributed fairly based on predefined rules.

• KKS1: Calculate variances. This step identifies any differences between planned and actual costs.

• CO88: Finally, settle production orders. This moves costs from production orders to finished goods, closing the loop on the production costing process.

Overall, implementing SAP CO for product costing in the steel industry provides an integrated approach to capturing, allocating, and analyzing production costs. When correctly configured and utilized, SAP CO enables steel manufacturers to get insights into their costs, thereby aiding in cost optimization and better decision-making.