Cut inspection costs with the SAP QM module's DMR functionality

Save time and money inspecting the quality of procured or produced materials with the SAP Dynamic Modification Rule (DMR), writes expert Jawad Akhtar.

Companies can tap into the Dynamic Modification Rule (DMR) functionality available in the SAP Quality Management

(QM) module to save the time, effort and costs involved in inspecting the quality of procured or produced materials.

DMR also helps to optimize the business processes by shortening the lead times in procure-to-produce and produce-to-sell business cycles.

Consider the following business scenarios:

  • A business process owner and quality inspector in the quality assurance and control department have a reliable and longtime vendor that routinely supplies materials that meet the company's specifications.
  • The quality of in-house produced goods has greatly improved after a major plant upgrade, making the quality of the goods routinely reliable.
  • The business ends up recording the same acceptable results of the inspected material, be it vendor-procured or in-house produced, over and over again.

If any of the above three items match your situation, then you can implement DMR functionality available in the SAP QM module to lock in place time-saving procurement or production processes regarding vendors and in-house produced goods you trust when it comes to the quality of the products.

You can still revert back to stringent quality controls using DMR if those goods once again face quality issues or questions.

Implementing DMR in your procurement or production processes offers several advantages, such as:

  • Vendors (and in-house production teams) are rewarded for consistently delivering high-quality products with lesser number of inspections involved. DMR helps meet this need, but at the same time offers companies the flexibility to allow for deviations to company product's specifications in the procured or produced material by having the system revert to regular or stringent inspection levels.
  • Reducing the lead time, costs and effort involved in inspecting each and every individual quality inspection lot, as well as recording results of the same.
  • Eliminating the need to record results and allowing the user to record usage decision only. In exceptional circumstances, the system still offers the option and the possibility to record results.
  • Lessening the inventory carrying cost as you can quickly make available raw material the vendor delivers to production personnel. Dispatching in-house-produced finished goods to the customer is expedited faster, and without as much waiting time involved in quality clearance.
  • During the vendor evaluation phase, the company has all the information it needs, including inspection lots rejected during the DMR process, which it can use to negotiate better prices and other terms and conditions.

As a part of quality management business process, the quality inspector performs at least two main steps in SAP:

  • Recording the results of an inspection lot. An inspection lot contains comprehensive details of the tests of material that the quality inspector needs to perform and enter. The system then checks the entered results with material's specifications to help the inspector decide whether to accept or reject the inspection lot. 
  • Deciding if the material be released to "unrestricted" or "free-to-use" stock, scrap it, block it for further inspection or simply return it to vendor, otherwise known as the usage decision.

Using DMR, the SAP QM module can be configured to assign a "skip" status to inspection lots. A skip status of an inspection lot means that you do not need to record the results of the inspection and instead may proceed with the usage decision.

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However, should the inspector find exceptional circumstances, like visible defects noted in the material, and the inspector has to record results of the inspection lot, you can do so even on the skip status. Further, the quality inspector can define the number of skip inspections before system must again ask you to enter results of an inspection lot.

For example, the administrator could set DMR to prompt the inspector to record the results of the inspection at a predetermined number of inspections, such as one out of six. This option provides checks and balances to ensure you are in fact periodically inspecting the product and ensuring that there are no oversights or other unforeseen problems at a later stage. This also prevents the possibility of taking usage decisions en mass, on the assumption that procured materials or produced goods continue to meet the product's specifications.

In DMR, the inspector can define the control levels needed for each inspection lot, including minimal, normal or heightened inspection levels. Those can be changed, according to the results of those selections. For example, the inspector may have DMR set to a "normal" inspection scheme, in which the system skips to a "reduced" inspection level if no problems are found over a certain period of time.

However, if one skip-status quality inspection records the results as "rejected," then the system can revert back to "normal" inspection levels. 

You need to engage an SAP QM consultant for the necessary configuration, testing and training for comprehensively implementing DMR in your organization.

ABOUT THE AUTHOR
Jawad Akhtar is an assistant vice president and SAP project manager for AbacusConsulting, where he focuses on SCM issues. AbacusConsulting is based in Pakistan.

This was first published in August 2013

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