2

© SAP 2007-2008 / 3

What We'll Cover ...What We’ll Cover …

Overview of SNP and how it fits in SAP SCMMaster data in SNPPlanning with SNPDeployment with SNPTruck loading with SNPPlanning by exception with the Alert MonitorSpecial planning topics in SNPIntegration of SNP with DP, PP/DS, and SAP ERPWrap-up

© SAP 2007-2008 / 4

Planning Horizon

Supply Network Planning (SNP)

Demand Planning (DP)

Production Planning (PP)

Detailed Production Scheduling (DS)

Deployment (SNP)

Planning Horizon

TLB – Transport Load Builder (SNP)

Planning horizon goes from wide to narrowSAP APO SNP is used for:

Mid- to long-term planning to create a feasible supply planShort-term planning to deploy product to warehousesBuild trucks

How wide and how narrow varies from industry to industry, for instance:

SNP: 3 months to 18 monthsDeployment: 10 days to30 daysTLB: 5 days to 15 days

© SAP 2007-2008 / 5

SNP Planning Functionality

Mid- to Long-Term Planning MethodsSNP HeuristicCapable-to-Match (CTM)SNP Optimizer

Deployment (Short-Term Replenishment Planning) Deployment Heuristic Deployment OptimizerDeployment Prioritization

Transportation Load Builder (TLB)Grouping of deployment stock transfers to a Stock Transfer Order (STO)

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3

© SAP 2007-2008 / 6

Defining the Planning Horizon in SNP

Starting point for planning with SNP is defined with the SNP Production Horizon

Defined in calendar days, weeks, or monthsCalculation starts on the:

System datePlanning start date of the Planning Book

Defined globally by planning version or by product and location

SNP Stock Transfer Horizon can also be used to define the starting point for planningExample:

SNP Production Horizon: 25 calendar days

Not planned by SNP Planned by SNPPlanning horizon

25 Calendar days

© SAP 2007-2008 / 7

Defining the Planning Horizon in SNP (cont.)

SNP HorizonsSNP Prod Horizon – No planned orders createdSNP Stk Trans Horizon – No PurReq createdExtended SNP Prod Horizon – only manual planned orders in this horizon, must be in complement with SNP Prod Horizon, not standalone

© SAP 2007-2008 / 8

SNP Planning Sequence and Flow

Perform SNP Heuristic,Optimization, or CTM run

Finalize SNP planand release to PP/DS

Check plan/solve problems

Deploymentrun

Release constraint-based SNPplan to DP

TLB run

Build loads fornon-assigned

transport orders

Set up master data andsupply chain model

Release demandplan

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4

© SAP 2007-2008 / 9

Interactive Planning with SNP Planning Book

Key figures

Time Buckets

Data section

You can use macros to perform

complex calculations

quickly and easily

The Data Views area is where the

planner selects Planning Books and Data Views

Shows data selected

The selection profile shows selection IDs used by the current planner

SNP Planning Book Screen

Planning Book Executable Functions (by Location, Network, Multi-Level)

This section of the screen can display different data (Alerts, Product View) depending on selection made

© SAP 2007-2008 / 10

Planning in Buckets with SNP

SNP plans in buckets, not to individual orders by datesand times

Data can be stored in Order liveCache or Times SeriesBuckets can be defined as daily, weekly, or monthlyTime bucket profiles are used to define the buckets and planning horizonDifferent buckets can be used over the planning horizon

Example for a 12-month planning horizon:Week 1 to 4 – dailyWeek 5 to 30 – weeklyRest – monthly

Demand and supply is grouped together to one number per bucket

Detailed orders per bucket can be displayed

© SAP 2007-2008 / 11

Key Figure Definitions

Same as Distribution Receipt (Planned), but as STO plant (receiving side)Distribution Receipt (TLB)

Same as Distribution Receipt (Planned), but as a stock transfer to the plant (receiving side)

Distribution Receipt (Confirmed)

Same as Distribution Receipt (Planned) for subcontracting materials (receiving side)

Distribution Receipt (Subcontracting)

Stock transfers that are generated during the SNP planning process, and updated in every planning phase. The distribution receipt shows the receiving location’s view of these stock transfers (the view from the supplying location is provided by the distribution demand). This will be created as above, but on receipts side.

Distribution Receipt (Planned)

Stock Transport Order (created during TLB run). Distribution Demand TLB will consume Distribution Demand Confirmed.

Distribution Demand (TLB)

Same as Distribution Demand (Planned), but as a stock transfer to the receiving plant. These are also called Deployment Requisitions. Distribution Demand Planned is populated by the deployment process based on inventory Available-to-Deploy (ATD). Distribution Demand Confirmed will consume the Distribution Demand Planned.

Distribution Demand (Confirmed)

Same as Distribution Demand (Planned) for subcontracting materialsDistribution Demand (Subcontracting)

Stock transfers that are generated during the SNP planning process and updated in every planning phase. The distribution demand shows the supplying location’s view of these stock transfers (the view from the receiving location is provided by the distribution receipts). This will be populated after Distributed Resource Planning (DRP) run for non-subcontracting materials.

Distribution Demand (Planned)

This will come from SAP ERP into SAP APO via CIF. Sales orders will consume the forecast.

Sales Order

This will come from Demand Planning after DP release to SNPForecast

SourceSNP Key Figures

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5

© SAP 2007-2008 / 12

Key Figure Definitions (cont.)

Inbound Deliveries or Advanced Shipment Notifications for POs or STOs from SAP ERP

In Transit

Production Planned at manufacturing plantProduction (Planned)

Available-to-Deploy (macro calculation) for issues (what you deploy as issue)

ATD Issues

Available-to-Deploy (macro calculation) for receipts (what you can deploy as receipts)

ATD Receipts

The system calculates the days’ supply as follows: Stock is divided by daily demand (macro calculation)

Days’ Supply

Represents a stock level that should be reached through planning in order to smooth out production and cover sporadic requirements

Safety Stock Level

Target value for the days’ supply of a location product (from Product Master)

Safety Days of Supply

Threshold value for the available stock below which procurement proposals should be created (from Product Master)

Reorder Point

Difference between Demand and Supply calculated by a macroSupply Shortage

Current or Projected unrestricted inventory available at a locationStock On-Hand

Same as Production (Planned) but for confirmed productionProduction (Confirmed)

Same as Production (Planned) but for subcontracting materialProduction (Subcontracting)

SourceSNP Key Figures

© SAP 2007-2008 / 13

Macros in SNP

Macros function similarly to formulas in spreadsheets, but are more advanced and provide greater flexibility

Macros are assigned to Planning Books and Data ViewsCan be executed automatically or on demand by the user

Can choose from SAP-provided standard macros or build custom macros in SAP APO

Unlike in DP, SNP has many standard macros provided by SAPStandard macros might be sufficient most of the time

Custom macros are like “user-defined” formulasProvide planners with the ability to model user-specific planning scenarios based on individual business tasksCan create context- and user-specific planning views

Can trigger alerts in the Alert Monitor or Data View to inform the planner of specific business situations

© SAP 2007-2008 / 14

Building Macros in SNP

Work area for creating/changing macros

Different elements available

for building macros

All macros assigned to a Planning Book and Data View

Assignments that

determine how and when the

macros are executed

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6

© SAP 2007-2008 / 15

Default macros are executed automatically

whenever data is entered in the Planning Book

Start macrosare executed automatically

when the data is loaded into the Planning Book

Directly executed macros are only

executed bythe user in the Planning Book

Calling Macros in SNP Interactive Planning

© SAP 2007-2008 / 16



© SAP 2007-2008 / 17

Master Data Objects Needed for SNP

LocationsProduction plants, DCs, vendors, customers, etc.

Transportation lanesRelationship (connection) between locations

ProductsBy location (product location – a unique object in SAP APO)

ResourcesProduction, handling, storage, transportation

SNP Production Process Models (PPMs)/Product Data Structure (PDS)

Based on production version with Bill of Material (BOM), routing, or master recipe from SAP ERP system

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7

© SAP 2007-2008 / 18

Core Interface (CIF) for Master Data Transfer

SAP ERP Master DataSAP ERP Master Data SAP APO Master SAP APO Master DataData

PlantLocation

SAP ERPSAP ERP SAP APOSAP APO

CustomerVendor

Material Master

Work Center

Routing/Recipe

Bill of Material/Prod Version

Product

Resource

Production Process Model

or Production

Data Structure

Incremental Data Transfer

Initial Data Transfer

© SAP 2007-2008 / 19

Core Interface (CIF) for Master Data Transfer (cont.)

Transfer of master dataSAP ERP is the execution system for master data, and it retains ownership of all master dataCIF always transfers SAP APO-relevant master data from SAP ERP to SAP APO

Core interface performs initial data transfer as well as subsequent data changesSubsequent data changes can be scheduled to run in real time or periodically

It is recommended to schedule master data change transfer periodically during off hours for performance and system integrity reasonsIt is possible to set the definitions of SAP APO-relevant master data in SAP ERP or via CIF user exits. New “SAP APO” fields often have to be set up in SAP ERP because they do not currently exist there.

© SAP 2007-2008 / 20

Most Common Locations in SAP APO for SNP

Customer

SAP ERP Master DataSAP ERP Master Data SAP APO Location/Location TypeSAP APO Location/Location Type

Plant

Vendor

MRP Area

Customer 1010

Vendor1011

MRP Area1007

Distribution Center1002

Production Plant1001

DRP Customizing in SAP ERPDRP Customizing in SAP ERP

Node TypePlantPL5000

DC6000

CIF

SAP ERP IMG:Production>DRP>Basic Settings>

Maintain Assignment of Node Type-plant

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© SAP 2007-2008 / 21

Data in Locations

Locations contain data that is:

CIF’d over from SAP ERPMaintained directly in SAP APO

Data that is CIF’d from SAP ERP

General data:Time zoneERP vendor number for plant

Address

Data maintained directly in SAP APO

Planning calendars for:ProductionWarehouseShippingReceiving

ResourcesHandling Storage

Category groups for:StockAvailable-to-Deploy receiptsAvailable-to-Deploy issues

© SAP 2007-2008 / 22

Planning Calendar/Time Stream in SAP APO

Time stream (planning calendar) defines available days/time (i.e., working time) using:

Time zoneFactory calendarTime horizonCalendar type

Factory calendar (with gaps)Period calendar (without gaps)

Period typeWeeklyMonthly

Two types of time streams exist in SAP APO:Standard SAP APO time streamCTM time stream (without gaps is suggested)

© SAP 2007-2008 / 23

Time Stream ID

General dataHorizonTime zone

Calendar typeFactory Calendar (with Gaps)Period Calendar (Without Gaps)

Period typeWeeklyMonthly

Period definition

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© SAP 2007-2008 / 24

Factory Calendars in SAP APO

Factory calendars in SAP APO are the same as in SAP ERPDefine workdays of a week and holidaysCan be synchronized with SAP ERP via Transfer Global Settings

Transfer Global Settings Global master data settings available for transfer from connected SAP ERP source system:

Units of currencyUnits of measureFiscal year variantsFactory calendars

Various available options for transfer: Update tablesRebuild tablesTcode: RSA1

© SAP 2007-2008 / 25

Time Zones

Set of rules that defines the offset of the user’s local time from Coordinated Universal Time (UTC)

UTC replaces the term Greenwich Mean Time (GMT)

The local time of a particular location or user depends on theirposition on the globeThe offset of a location from UTC is influenced by:

Geography (position on the globe) Political factors (time zones are assigned for a country, region, or even a postal code) Daylight Saving Time (DST), if applicable

Time zones are important master data that help derive realistic lead times for procurement proposals during planning runsCan be set by the user in his or her user profile settings (txn. SU3)

© SAP 2007-2008 / 26

Transportation Lanes

The Transportation Lane defines:Which location is the source of a product to a target locationRelationship between two locationsThe transport lead time

Needs to be in sync with routes in SAP ERPThe means of transportation (truck, train, plane, etc.)The capacities of each means of transport in a lane, including:

VolumeWeight Number of pallets

Products that can be transported from the source to the target location (defined for each lane)

Product assignments can be maintained via Special Procurement Key in SAP ERP

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© SAP 2007-2008 / 27

Transportation Lanes (cont.)

Prioritization Factor

© SAP 2007-2008 / 28

Product/Material Master

The Material Master in SAP ERP correlates with the Product Master in SAP APOProduct Master in SAP APO is created by:

Transferring Material Master from SAP ERP to SAP APO via the CIFCreating directly in SAP APOImporting from a non-SAP system

Certain data is transferred from SAP ERP to SAP APOBasic dataUnits of measureMRP dataClassification data

Other data is maintained directly in SAP APOSpecial settings that don’t exist in SAP ERP for: (unless new fields are created)

CTMOptimizerDeployment

© SAP 2007-2008 / 29

Product/Material Master Basic Data

Values relevant to SAP APO will pass through the CIFSAP ERPSAP ERP

SAP APOSAP APO

SAP ERP

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© SAP 2007-2008 / 30

Product/Material Master Planning ParametersValues relevant to SAP APO will pass through the CIF

SAP ERPSAP ERP

SAP APOSAP APO

© SAP 2007-2008 / 31

Resources

Resources are created to represent the capacities and working times of production lines, equipment, and laborProduction resources can be transferred from SAP ERP to SAP APO

SAP ERP

1000

F1Y1

Plant

Work Center

Cap Category

Cap Category

001

002

Machine

Labor

Capacities

SAP APOResource

Resource Name Cat Location

WF1Y1_1000_001

WF1Y1_1000_002

P

P

1000

1000

Two Multi Mixed

© SAP 2007-2008 / 32

Resource Types in SAP APO

Single Activity Resource

Multi Activity Resource

Single Mixed Resource

Bucket Resource

Multi Mixed Resource

Ava

ilabl

e C

apac

ity/A

ctiv

ity

Single

Multi

Capacity Definitions in Time

Time Continuous Time IntervalsTime Continuous

and Time Intervals

PP/DS SNPPP/DS & SNP

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© SAP 2007-2008 / 33

System of Origin for Resources

Production resources are typically CIF’d from SAP ERP to SAP APO

Capacity information is maintained in SAP APO, not in SAP ERP

Needed in SAP ERP and SAP APO for link between routing/recipe in SAP ERP and PPM/PDS in SAP APO

Handling, storage, and transportation resources are created and maintained in SAP APO onlyMixed resources can be used in both SNP and PP/DS, and are recommended to use as much as possible

Very difficult to change resource type later if PP/DS is used

© SAP 2007-2008 / 34

Plan and PPM

Co-products

Finishedproduct

I I

I I

O

OO

I

SNP PPMs

PPM has detailed information required for producing a product ResourcesComponentsTime

PPM is a combination of routing and BOM from SAP ERP in one object in SAP APOThe plan puts together:

CostsRouting

OperationsActivities

Bill of Material (BOM)Input products (I)Output products (O)

PPMs are assigned to the plan:Location-dependent (PPM ID)Minimum/maximum lot sizes for the finished productValidity periods

© SAP 2007-2008 / 35

Converting a PP/DS Product Process Model to an SNP Product Process Model

Production versions (including routing and BOM) are transferred as PP/DS PPM from SAP ERP to SAP APO

SAP APO allows you to generate SNP Production Process Models (PPMs) based on existing PP/DS PPMs

Conversion options for generation of SNP PPMs are:SNP PPM generation with lot size margin SNP PPM generation without lot size margin

Conversion process needs to be repeated for subsequent changes that were made to routings/BOMs and/or PP/DS PPM SNP PPM can be created directly in SAP APO without reference to a PP/DS PPM

Transaction to maintain PPMsUser exit to create PPMs programmatically (BEST option)

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© SAP 2007-2008 / 36

Product Data Structure

A structure generated in SAP APO from a production version or Bill of Material in SAP ERP … similar to the PPMContains information about the production resource and the component assignment for the production of a productYou can use PDS as a source of supply for in-house production in PP/DS, SNP, Capable-to-Match (CTM), and Demand Planning (DP) areasSNP PDS can be transferred separate from PP/DS PDSCannot be maintained in SAP APOCan select to use on the Product Master – PP/DS TabAlternate object to PPM going forward (SAP SCM 4.1 and above)

Restrictions exist which might require use of PPMsSee also SAP Notes 705018, 709884, and 744445

© SAP 2007-2008 / 37

SNP Product Process Model or PDS

Functionalities supported by PDS, but not by PPM:

Engineering Change Management (ECM) for PP/DSSubcontracting in SNP is fully integrated with SAP ERPDirect transfer of SNP-PDS from SAP ERP (no conversion step)Use of object dependenciesin SAP APOOrder-BOM and WBS-BOMRapid planning matrix

Functionalities supported byPPM, but not by PDS:

Maintenance in SAP APOPush-productionContainer resourcesNet flag for component scrapStep function for the standard value of the durationOverrule the synchronization setting of the resource onactivity levelRestriction of the validity requirements of an order onactivity level

© SAP 2007-2008 / 38



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© SAP 2007-2008 / 39

Planning Methods in SNP

SNP HeuristicHeuristics run creates an Infinite Supply PlanSourcing can be done via quota arrangementsCapacity leveling as second step for finite plan

Capable-to-Match (CTM) profile and rules-drivenSourcing based on priorities or quota arrangementsFinite capacity planning possibleSNP and PP/DS modes possible

SNP OptimizerCost/penalty-drivenFinite capacity planning possibleFull constraint-based planning possible

© SAP 2007-2008 / 40

What does the word Heuristic mean?“Heuristic” comes from the Greek word “Heuriskein,” which means “to find or discover”

It was originally used to describe the art of invention

In SAP SCM, it means to find a sufficiently good solution in an acceptable period of time

In other words …SNP Heuristics will allow the plan of materials either through production or procurement on an infinite manner

Heuristics Definition

© SAP 2007-2008 / 41

Heuristics Scenario — Sourcing

How is sourcing determined? Priorities and quotas

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© SAP 2007-2008 / 42

SNP Heuristic and Capacity Leveling

Repair-based planning process consisting of two steps: HeuristicsCapacity leveling

Heuristic: Infinite planning Performs requirements planning

Location by locationProduct by product

Plans/creates infinite supply plan to satisfy demand requirements in the supply chain networkCapable of handling quota arrangement functionality for source determinationExplodes the BOM and generates supplies in the network

Capacity leveling is done in a separate step Address capacity over and under loadCan be executed interactively or in background jobAlternative Resource option as of SAP APO 5.0

© SAP 2007-2008 / 43

Heuristic Options

Heuristics can be run either interactively or in the background.The following three options are available interactively through the planning book:1) Location Heuristics – Plans only selected location product2) Network Heuristics – Plans the selected product for all

locations3) Multi-level Heuristics – Plans the selected product with all

components at all locationsNote: Multi-level Heuristics is not available to run in the background, but there is an option to take components into account in the planning run

© SAP 2007-2008 / 44

Heuristics Scenario — Infinite

8311783%Capacity Level

100140100Hrs.Capacity Consumption

120120120Hrs.Available Capacity

03/19/07

03/12/07

03/05/07UnitSNP

83

117

83

0

20

40

60

80

100

120

140

3/5/2007 3/12/2007 3/19/2007

Capacity

OverloadingAlerts

Plans receipts based on unconstraint capacity

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© SAP 2007-2008 / 45

Capacity Leveling

Backward and Forward leveling is supportedBackward: Looks in the past for available capacityForward: Looks in the future for available capacityBackward/Forward: Looks for capacity in both directions

83

117

83

0

20

40

60

80

100

120

140

3/5/2007 3/12/2007 3/19/2007

CapacityOverloading

Alerts

Backward Forward

© SAP 2007-2008 / 46

Capacity Leveling in SNP

Alternative resource option in SAP APO 5.0Check box to activate the optionProcurement Priority on the PPM/PDS is used to determine the order in which the alternates are selectedAll Relevant Resources = Select ALL existing resources in SAP APOResource = Specific resource(s) as defined by userSelection Profile = Resources as defined in the profileSource Determination Level: Use only if Resource Hierarchy exists (AGG)

Only Header Level: All subresources are replaced by header resourcesOnly Sublevel: All header resources replaced by subresourcesAll Levels: Resource set remains unchanged

© SAP 2007-2008 / 47

CTM General Concept

Source: SAP

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© SAP 2007-2008 / 48

CTM Planning Process and Components

Source: SAP

© SAP 2007-2008 / 49

CTM Regenerative Planning

Source: SAP

© SAP 2007-2008 / 50

Demand and Supply Aggregation

Source: SAP

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© SAP 2007-2008 / 51

Demand Prioritization

Source: SAP

© SAP 2007-2008 / 52

CTM 5.1 Enhancements

Supply Distribution after or before a CTM planning run transferssurplus receipts and stocks available to other location in the supply chain model To ensure a feasible transfer, lot sizes as well as transportation and handling resources are now considered during the supply distribution

New supply distribution is incorporated into CTM planning runOne level push of surplus supply happens according to the outbound quota

© SAP 2007-2008 / 53

SNP Optimizer Overview

Just like Heuristics, Optimizer is a quantity-based, cross-location planning engineUnlike Heuristics, the Optimizer takes cost-based constraints to arrive to a most feasible and cost-effective solutionOptimization is based on linear and mixed integer linear programmingThe Optimizer does not use quotas, but can create them

Note: As of SAP APO 5.1 – inbound quotas are supported

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© SAP 2007-2008 / 54

SNP Optimizer

The Optimizer uses linear programming methods for planning, such that it simultaneously considers all relevant factors, making the entire chain as a single problemThe objective of the Optimizer is to find the optimal solution to an equation (target function) in which all the cost and penalty factors are considered simultaneouslySince the Optimizer assesses alternatives this way, it can determine the best feasible plan on the lowest cost SNP Optimizer run modes:

Running the Optimizer from the Interactive Planning Desktop Running the Optimizer in the background– Likely way to run it in a live environment

One time period (bucket)

Demand at a location

Dependent demand at alocation

Processing flow

© SAP 2007-2008 / 55

Optimizer Scenario — Sourcing

How is sourcing determined? Least feasible cost.

© SAP 2007-2008 / 56

Linear vs. Discrete

The use of fixed and minimum lot sizes and time-dependent costs (cost functions) will require a discrete runDiscrete runs have the potential to significantly increase the run time to arrive at an optimal solution

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© SAP 2007-2008 / 57

Optimizer Profile — General Constraints

Activates the constraints during

optimization

Activates maximum lot size

Activates safety stock constraint, absolute vs.

relative option

Activates shelf-life constraint

© SAP 2007-2008 / 58

Optimizer Profile — Automatic Cost Generation

Activates parameters

Determines transactional

priority

Activates product priority

© SAP 2007-2008 / 59

Automatic Cost Generation

Costs are generated based on determined business goalsCosts used during generation will override maintained costsNot all costs are generatedGeared towards less complex modelsSNP Cost Profile not taken into consideration

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© SAP 2007-2008 / 60

SNP Optimizer 5.1 — Quota Arrangements (New)

SNP Optimization respects time-dependent inbound quota arrangements on procurements from source locations, external suppliers, and in-house productionDeviation from quotas are penalized and visualized with the Objective functionIt is possible to define inbound quotas for products or product groups

Product Group Time-dependencyPenalty for deviation below target quantityPenalty for deviation above target quantity

Optimizer Profile General Constraints Tab:

© SAP 2007-2008 / 61

Profit Driven Supply Network Optimization — Penalty Groups

Consider penalty groups to prioritize customers or customer segments within SNP optimizationUse the grouping as input for layered SNP Optimization to sequentially plan customer segments according to their importance

© SAP 2007-2008 / 62

SNP Planning Methods Comparison

Function SNP Heuristic

CTM SNP Optimizer

Safety Stock Yes Yes Yes Min/Max lot-size Yes Yes Yes1 Rounding value Yes Yes Yes1, 7 Transportation Duration Yes Yes Yes Selection of Means of Transport (Dates vs. Costs)

Yes Yes Yes

Stock Transfer Horizon Yes Yes3 Yes2 Production Duration Yes Yes Yes Production Resource No4 Yes Yes Transport Resource No5 No5 Yes Handling Resource No5 No5 Yes Storage Resource No5 No5 Yes Quota Arrangements Yes Yes No6 Procurement Priority of Transportation Lane

Yes Yes No8

1 With discrete optimization only but not with linear2 Setting in Optimizer profile3 Setting in control setting 4 Not in SNP Heuristic, but can be done with

capacity leveling step

5 Capacity loads are calculated but no finite planning6 SNP Optimizer can be used to create quota

arrangements – YES in SAP SCM 5.17 Either from product master or transportation lane8 Transportation cost is used to select means of transport

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© SAP 2007-2008 / 63

SNP Planning Methods Comparison (cont.)

CTM OPTIMIZERHEURISTICS

FUNCTIONAL COVERAGE

QUALITY OF PLAN OBTAINED

MAINTENANCE

INTERACTION ON PART OF USER

INTERPRETATION OF RESULTS

PERFORMANCE

VIABILITY OF PARAMETER DEFINITION

DIFFICULTY OF PARAMETERIZATION/CONFIGURATION

Complexity and Degree of Difficulty

© SAP 2007-2008 / 64



© SAP 2007-2008 / 65

Deployment Definition

Deployment determines which distribution center and VMI customers’ demand can be covered by current receiptsIf quantities are not sufficient, or if they exceed the demand, deployment can make adjustments to the stock transfers made by the SNP runOrders created by this tool are called Deployment Stock Transfers

Deployment is only used to confirm stock transfers (actual routeplanning, transport service selection, and delivery generation are handled by TP/VS)

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© SAP 2007-2008 / 66

Available-to-Deploy Calculation

Available-to-Deploy (ATD) quantity defines the quantity that is available in the delivering plant for distributionDefined by ATR (receipt) and ATI (issue) category groups in customizing, and assigned to Location master or Product master at the location level (SAP SCM 5.0) Receipts (Available-to-Receipts) can be stock on-hand, production orders, purchase orders, etc.Issues (Available-to-Issues) can be STOs, sales orders, deployment orders, etc.

Date: ATD Quantity: Requirements:

Detailed requirements per DC:

Today

Supp

ly

Dem

and05.01.2007

06.01.200707.01.2007

1000900400

100 (DC1)500 (DC2)800 (DC1+2)

DC1DC2

200600

Deployment ResultsPlant to DC1Plant to DC2Plant to DC1Plant to DC2

100500100300

05.01.200706.01.200707.01.200707.01.2007

© SAP 2007-2008 / 67

Deployment Methods in SNP

Deployment HeuristicCalculates a replenishment plan for each product at a delivery locationRules-based

Deployment OptimizerCalculates a replenishment plan for a product in all locations within the networkCost-based

Deployment PrioritizationExtra step after deployment runDetermines importance of deployment order

© SAP 2007-2008 / 68

Deployment Heuristic

The Deployment Heuristic uses predefined rules for:

Fair share in a shortage situationPush deployment in a surplus situation

Hierarchical view of supply networkCalculates replenishment plan for a product in a delivery locationStarted for one product; product by product

Bases for Deployment Heuristic are the stock transfer requisitions (planned) created by an SNP planning run

DC2

DC1

Plant

Deployment adjusts the stock transfers for short-term changeson both the supply and demand side (distribution detailed planning)

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© SAP 2007-2008 / 69

Deployment Heuristic vs. Optimizer

HeuristicStarted for one source location and multiple target locationsProduct by productRules-basedEasier to use and deploy

OptimizerFocuses on network

Multiple source and target locations

All products and all locationsCoverage maximizationCost-based optimizationCan consider constraints like transportation and storage capacity

Heuristic

Optimizer

© SAP 2007-2008 / 70

SNP Planning and Deployment Run Sequence

HeuristicSNP Heuristic (or SNP Optimizer)

Creates distribution demand (planned)Deployment Heuristic

Distribution demand (planned) is the basis for deploymentCreates distribution demand (confirmed)

OptimizerDeployment Optimizer

Deletes all distribution demandCreates distribution demand (confirmed) from scratch

SNP Optimizer (or SNP Heuristic)Distribution demand (confirmed) are firmed for SNP runCreates distribution demand (planned)

© SAP 2007-2008 / 71

Deployment Prioritization

Prioritization of deployment stock transfers: IntroductionDeployment priority further optimizes the deployment processDeployment prioritization considers deployment orders from Deployment Heuristic or Optimizer as inputPrioritization sets a priority number for all deployment stock transfersPrioritize can be displayed during Truck Load Building (TLB)

Prioritization function groups the deployment stock transfers into three categories:

Cat. 1 – stock transfers for fulfilling shortagesCat. 2 – stock transfers for fulfilling safety stock levelCat. 3 – stock transfers for fulfilling planned replenishments above safety stock levels

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© SAP 2007-2008 / 72

Deployment Prioritization (cont.)

Deployment prioritization assigns a priority number to all deployment stock transfers by categoryThe assigned shipment priority number indicates the relative urgency of the deployment stock transfer

Factor above safety stock after deployment stock transfer receivedi.e., 14 = 1.4 X of safety stock

20 = 2.0 X of safety stock

11-99Cat. 3: Stock transfers for fulfilling planned replenishments above safety stock levels

Represents the percent of safety stock level left if not fulfilled i.e., 1 = 10%

6 = 60%

1-10Cat. 2: Stock transfers for fulfilling safety stock level

Highest priority of alli.e., 0

0Cat. 1: Stock transfers for fulfilling shortages

Priority DescriptionPriority RangeCategory

© SAP 2007-2008 / 73



© SAP 2007-2008 / 74

Transport Load Builder (TLB)

The TLB’s main purpose is to create multi-product transport orders (STOs) based on the results of a deployment run

For a transportation lane and means of transport

For a specified time period

Loads are grouped according to:Products (transportation planner)Time (pull in horizon)

Transportation zones (target and means)

Ensures that minimum and maximum requirements are met for:

VolumeWeightNumber of pallets

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© SAP 2007-2008 / 75

Transport Load Builder (TLB) (cont.)

TLB changes the stock transfer orders (confirmed) from the deployment run into TLB ordersStock transfer orders are grouped together until maximum capacity is achievedIf minimum capacity is not achieved, it has to be processed manually There is no tracking of resource usage, product-specific constraints, or special transport requirements

Some basic modeling of constraints is possible by means of transport

If the planned transport orders do not meet the minimum or maximum requirements, an alert is generatedOnly for stock transfer and does not include deliveries for sales orders

© SAP 2007-2008 / 76

TLB Profile

The TLB Profile minimum and maximum values are definedTLB uses lot size profile when building loadsLoad Method: Options on how to load the means of transport (Product by Product, Equal Loading)Pull-in Horizon: Number of days from today’s date during which the TLB can take into account existing deployment stock transfers to create TLB shipments

Source: SAP

© SAP 2007-2008 / 77

Load Building

Transport loads generated by the tool can be seen in the Interactive Planning tool by dayIf minimum capacity was not met within the pull-in horizon, TLB stock transfers for later deliveries can be moved manuallyDrag and Drop functionality for unconverted deployment stock transfers is available

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© SAP 2007-2008 / 78

Transport Load Builder (TLB) —Interactive

TLB Planning Screen

Deployment requirements tobe loaded are displayed here

Truck load section

Lane and means of transport selection

Deployment Requirements section

Truck load details (for order selected above)

Order Numbers

© SAP 2007-2008 / 79

Stages of a Stock Transfer in SNP

Deployment Order Confirmed

Stock Transfer Requisition

TLB Order

Stock Transfer Order

SNP planning run

Deployment run

Transfer to SAP ERP

TLB run

© SAP 2007-2008 / 80

Stock Transfer Requisition After SNP Planning RunWhen a Stock Transfer Requisition is created at the receiving location, it creates a distribution demand at the sending location

Distribution Demand (Planned) after SNP Heuristic, CTM, or SNP Optimizer run

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© SAP 2007-2008 / 81

Deployment Order Confirmed After Deployment

The Deployment Order Confirmed is displayed as Distribution Demand (Confirmed). Note that the Stock Transfer Requisitions disappear from Distribution Demand (Planned) line.

© SAP 2007-2008 / 82

TLB Order Confirmed After TLB Run

The TLB Order/STO is displayed as Distribution Demand (TLB-Confirmed). Note that the Stock Transfer Requisitions disappear from Distribution Demand (Confirmed) line.

© SAP 2007-2008 / 83



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© SAP 2007-2008 / 84

Alert Monitor in SNP

Alert Monitor provides users with visibility of exception cases in the Supply Network Plan

You can define, by user: Which type of alerts to show and their thresholds using Overall ProfilesWhat data is displayed in Alert Monitor using Display Hierarchies

Exceptions are calculated using macrosSAP provides standard macros and the ability to build your own macros to create customized alerts

Alerts are generated for user-defined planning situations involving Location products and ResourcesThe Alert Monitor is organized by profiles per application area:

SDP alert profile – monitoring DP and SNP alertsTLB alert profile – monitoring TLB and Deployment alertsVMI alert profile – monitoring VMI alerts

© SAP 2007-2008 / 85

Alert Monitor Setup Pointers

Only an Overall Profile can be assigned to the

Alert Monitor

Only the SDP Alert Profile can be assigned to a Planning Book. Multiples can be created, but

only one is current on theOverall Profile.

Be aware of the checked boxes. They will generate

alerts even if no threshold is set.

The Selection Profile assignment determines

the products that the alerts will be

generated against

Issue

© SAP 2007-2008 / 86

Alert Monitor

Alert Monitor (Transaction /SAPAPO/AMON1)

Interactive Alert Display (transaction /SAPAPO/SDP94)

Clicking on an item in the Alert Monitor will take

you to the Planning Book with details for that item

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© SAP 2007-2008 / 87

What We’ll Cover ...What We’ll Cover …


© SAP 2007-2008 / 88

Special Planning Topics

Safety Stock Planning in SNPVendor Managed Inventory (VMI)Subcontracting with SNPProduct Interchangeability Aggregate Planning with SNP

© SAP 2007-2008 / 89

SAP APO Safety Stock Planning

Demand uncertainties (forecast quantity)Supply uncertainties (replenishment time)Methods to protect against uncertainty

Overestimate customer demandUnderestimate production output quantityOverestimate procurement lead timesBuild up safety stock

PlanningPlanning

RealizationRealization

Safety Stock to cope up with uncertainties

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© SAP 2007-2008 / 90

Objectives of Safety Stock Planning

Business goal: To ensure (high) service level of product at the lowest cost despite fluctuations in the various levels of the supply chain

Problem:At which locations within the supply chain do you want to have safety stock?How much safety stock do you want to hold at a particular location?

Uncertainty of supply Uncertainty of demand

© SAP 2007-2008 / 91

Methods for Safety Stock Planning

How to determine safety stock for each product location?

By choosing a safety stock method for a product and location

What safety stock level?Depending on chosen safety stock method

Basic (standard) safety stock methodsAdvanced (extended) safety stock methods

Safety stock planning is embedded into Supply Network Planning

SNP Heuristic and OptimizerCan be used in CTM and PP/DS applications

© SAP 2007-2008 / 92

Safety Stock Fields on Product Master in SAP APO

Fixed safety stock qty (CIFed from SAP ERP for basic methods)

Safety Stock Method (set via CIF or

maintained in SAP APO)

SB – Requires fixed safety stock quantitySZ – Requires safety stock days

Values for advanced safety stock methods- Service level and- Demand and procurement error

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© SAP 2007-2008 / 93

Safety Stock Fields on Product Master in SAP APO (cont.)

Safety Days’ Supply (CIF’d from SAP ERP Safety Days) for basic methods

© SAP 2007-2008 / 94

Advanced Safety Stock Planning

Key inputsDesired service level Mode of replenishmentUncertainties

Deviation between forecasted and realized demandDeviation between planned and actual replenishment time

PrerequisitesRegular demand as opposed to sporadic demand

Can be used with sporadic demand with SAP SCM 5.0Backorder scenario (as opposed to lost sales case)

ConsiderationsLocation product master data

Safety horizonTarget stock level

Selection of “appropriate” safety stock methodAdjustments in Interactive Planning after safety stock run

© SAP 2007-2008 / 95

Desired Service Level for Safety Stock

Interpretation of service levelAlpha (shortfall event-oriented)

Expected number of periods with complete delivery fulfillment/total number of periodsPercentage of how often product is delivered on time

Beta (shortfall quantity-oriented)Expected quantity delivered in time/expected total demand Percentage of how much of ordered quantity is delivered

Choosing a service level depends on:Customer satisfaction

Alpha – complete delivery necessaryBeta – partial delivery possible

Costs for late deliveriesAlpha – backlog-independent (fix) costs of late delivery are significant Beta – backlog-dependent (variable) costs of late delivery are significant

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© SAP 2007-2008 / 96

SNP Planning Area + Version

Key figure to calculate safety stock

Start and end datefor calculation offorecast error

Example of Advanced Safety Stock Planning Run

Key figure for Demand Forecast (transferred from Demand Planning)

© SAP 2007-2008 / 97

Result of Advanced Safety Stock Planning Run

Safety stock

© SAP 2007-2008 / 98


Safety Stock Planning in SNPVendor Managed Inventory (VMI)Subcontracting with SNPProduct InterchangeabilityAggregate Planning with SNP

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© SAP 2007-2008 / 99

What Is Vendor Managed Inventory (VMI)?

Business goal: To include key customers in Supply Chain Planning

Benefits overview:Capability for the manufacturer to perform the replenishment planning tasks for their business partnersEnable better decision support for vendors, along with more knowledge and control over the logistical processIncrease visibility to actual customer demand as well as customer inventory levelsAllow manufacturers to make better decisions on how to deploy goods across various customers, which leads to:

Increased customer service level Lower transportation costsReduced inventory levels Lower sales costs

© SAP 2007-2008 / 100

VMI: Component/Process Overview

1. Receive consumption and inventory data from customer

2. Create demand forecast3. Run SNP4. Build efficient truck load

(TLB) to replenish stock5. Sales order is created

automatically6. Purchase order is created

in the customer system7. Issue product and send

Advanced Shipping Notification (ASN) to customer

8. Receive product at customer

9. Send invoice to customer10. Customer receives invoice

and initiates payment

Customer/Retailer

SAP ERPSAP APO

My Company

ERP

Transfer of Consumption and

Inventory Data

AutomatedP.O. Creation

Generate DemandForecast

Supply andDistribution

Planning

Build Efficient Truck Loads

Automated SalesOrder Creation

Pick, Pack, ShipGoods Issue

PostGoods Receipt

Advanced ShippingNotification

Post Invoice Receipt

Invoice

Transfer of Customer Forecast

© SAP 2007-2008 / 101

VMI Replenishment Strategies

Min/max replenishment The inventory is maintained within a fixed bandNew sales order is generated as soon as the inventory reaches the lowest level of the bandSales order quantity will replenish the inventory to the maximum of the band

Forecast-based replenishmentThe inventory is calculated to maintain forecast coverage for the specified number of daysSales order is generated as soon as the inventory drops below the calculated amountSales order quantity will replenish inventory back to the amount that covers forecasts for a specified number of daysThe strategy has the benefit of being able to account for seasonal spikes in the demand

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© SAP 2007-2008 / 102

My CompanySupplier Customer

Supplier Collaboration

Customer Collaboration

Inventory

SAP Supply Network

Collaboration (SNC) formerly ICH

Release Update

ASNs

Alerts

Demand

Confirmations

Change POs

GR Update

Plans/Orders

POs

Sales

PO Ackn.

Forecasts

Inventory

In-Transits

PO Number

Forecast Revision

Promotions

Collaboration with SNC (Formerly ICH)

© SAP 2007-2008 / 103



© SAP 2007-2008 / 104

Subcontracting — Business Value

Lets companies create a feasible procurement plan for subcontract manufacturers, taking into account all materials and capacity constraints

Planning of subcontractor production linesPlanning which bill of material will be used for each subcontract build

Lets companies consider preferred subcontractor production lines by priority or cost Lets planners perform manual adjustments and create subcontract purchase requisitions manually to incorporate any new information into the planning resultsFeatures seamless integration with SAP ERP 6.0 as of Enhancement Package 3

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© SAP 2007-2008 / 105

Subcontracting with SNP

Business scenarioYour company provides components to the supplierSupplier assembles the components and returns the finished product

SAP solution with SNPSupplier is set up as a location in SAP APOIn-house planned order is created at the supplier location to plan assembly of the componentsSubcontracting order is created for the stock transfer from:

Your plant to supplier for componentsSupplier to your plant for assembled end product

© SAP 2007-2008 / 106

Subcontracting with SNP (cont.)

Key considerations:Functionality addressed by SNP Heuristics and Optimizer

Followed by manual changes in Interactive PlanningSeparate Planning Book/Data View for subcontracting in Interactive Planning SNP PPM or PDS is needed for relationship of components to the end product

Can be CIF’d from SAP ERPTransportation lanes needed between supplier location and your plant location

Lanes are created via CIFSpecial subcontracting indicator

Relationship is maintained automatically between:Planned order at supplier location and stock transfer requisitions to/from supplier location in SAP APO, andPurchase requisition (subcontracting order) in SAP ERP

© SAP 2007-2008 / 107

SNP Subcontracting Process

SubcontractorPlant

Components

Finished Good

In a subcontracting scenario, the plant provides the subcontracting components to the supplier. The supplier assembles the components and returns the finished product.To support this process in SAP APO, in-house-production orders for the source location (supplier’s site) and related subcontracting orders for the stock transfer from supplier to plant, are being created.

Subcontract information record allows several production versions to be defined per subcontract vendor/material relationship, ensuring efficient utilization of existing capacities.

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© SAP 2007-2008 / 108

SNP Subcontracting — Process Detail

SAP APO

Plant

Sub-contractor

PPM_1PPM_2PPM_3

SNP-Run

Transportation lane: subcontracting

SNP PurchaseRequisition 1

SNP-Planned Order (PPM_1)

Demand

SAP ERP

PurchaseRequisition 1

SNP-Planned Order (PPM_2)

SNP PurchaseRequisition 2

PurchaseRequisition 2

© SAP 2007-2008 / 109

SNP Subcontracting — Process Detail (cont.)

1. The SNP run (Heuristic, Capable-to-Match, or Optimization) determines the subcontractor as the source of supply and generates a subcontracting purchase requisition to transfer the finished product from the source location (subcontractor) to the destination location (plant)

2. The SNP run determines the source(s) of supply (PDS/PPMs) at thesubcontractor and creates the subcontracting in-house-production order(s) in the source location (subcontractor).

The subcontracting purchase requisition can also be created manually in SNP with the ability to assign/change the subcontractor and the source of supply

3. A purchase requisition, which takes the subcontracting components (materials provided to the subcontractor) from subcontracting in-house-production order(s), is generated in the SAP ERP system

Prerequisite to consider multiple production versions in an SNP Subcontracting Process:

SAP ERP 6.0 Enhancement Package 3

© SAP 2007-2008 / 110


Safety Stock Planning in SNPVendor Managed Inventory (VMI)Subcontracting with SNPProduct Interchangeability Aggregate Planning with SNP

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© SAP 2007-2008 / 111

Product Interchangeability

Business scenarioConsider full interchangeability and discontinuation of product in the supply chainConsider constraint of limited validity and availability of materials and components in the supply chain

SAP solution with SNPEnables full interchangeability and discontinuation at any productlocation level

Transfer demands for a product that is to be discontinued onto a successor productUse existing stock of a current product to fulfill demand for the successor product

Can be done at any product levelEnd product or components of BOM

Works with SNP Heuristics and the SNP OptimizerIntegrated with DP

Creation of like or phase-in/-out profilesProduct split and realignment

© SAP 2007-2008 / 112

Product Interchangeability (cont.)

Benefits:Systematic and automated changeover from one product to another

Optimizing product availabilityMinimizing material stocks and scrapSecuring consistent data modelsEnabling continuous process flows

Types of product interchangeability:Discontinuation

A product is replaced by another one Supersession

A chain of products that can replace each otherForm Fit Function (FFF)

Grouping of interchangeable parts, which are identical in respect toall of their technically-relevant propertiesRelated to manufacturer part number functionality

© SAP 2007-2008 / 113

Supersession/Discontinuation

DiscontinuationProduct is replaced by anotherSimple case of supersession

A B

Forward and backward relationships Forward interchangeabilityFull/backward interchangeability

A B C D A B C DA B AA B C

SupersessionChain of products that can replace each otherConstant process of replacement

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© SAP 2007-2008 / 114

Scope of supersessionLocation(s)ProductsSuccessor product

Direction of interchangeabilityForward, or Fully interchangeable

Substitution valid from <date>

Use up of stockNo Yes Restricted until <date>

Use up date – date until the currently valid product can be used

Supersession/Discontinuation Inputs

A BA B

© SAP 2007-2008 / 115

Maintaining Interchangeability Group

Direct of Interchangeability- Forward- Full

Indicates the use up of stock- Yes- No- Restricted by Use Up Date

Product to be substituted

Successor Product

Location(s)

© SAP 2007-2008 / 116



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© SAP 2007-2008 / 117

Aggregated Planning with SNP

Business scenarioPlanning at an aggregate level for products and locations

SAP solution with SNPAbility to aggregate products and locations as well as resources and PPMs/PDSWorks with SNP Heuristics and the SNP Optimizer

CTM is supported with SAP SCM 5.0Separate planning area and Planning Book/Data View

Area 9ASNP05 (same as advanced safety stock planning)Book 9ASNPAGGR/view SNPAGGR(1) and SNPAGGR(2)

Benefits of planning at aggregated level:Performance improvements by calculation on aggregate levelsLarger supply chain models can be planned

Performance improvementsSimplified planning process by making planning decisions at an aggregated level

© SAP 2007-2008 / 118

Aggregated Planning with SNP (cont.)

Prerequisites for setting up aggregated planningCreate hierarchy structures and assign them to the SNPAGG planning area

SAP provides some standard hierarchy structures for locations, products, resources, PPMs/PDS

Define the aggregated planning objects Location aggregates, product aggregates, PPM/PDS aggregates, resource aggregates

Define the relations between aggregated objects and detailed objects

Location-product hierarchies, PPM/PDS hierarchies, resource hierarchies

© SAP 2007-2008 / 119

Aggregated Planning Process Steps

Process steps for standard scenario (product location)1. Aggregated Safety Stock Planning (optional step)

Standard and extended safety stock methods are availableSee also SAP Note 858794

2. Single-Level Supply and Demand Mapping (optional step)Prevents the system from assigning receipts to the wrong demandsduring aggregated planning, due to detailed information no longer being available at aggregated level

3. Aggregate demand, receipts, and stock to product group level (automatically)

Delete all planned replenishment elements on detailed item levelthat are part of the aggregate before performing an aggregated planning run – Optional but recommended way for live environment– Defined in configuration (Basic Settings Maintain Global

SNP Settings)

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© SAP 2007-2008 / 120

Aggregated Planning Process Steps (cont.)

Process steps for standard scenario (product location) (cont.)4. SNP planning run at Aggregated Level (Product Group

level)SNP Heuristics and Optimizer and CTM with restrictionsResults – aggregated planned production, planned external procurement, or stock transfers

5. Disaggregate planning data to detailed item levelAggregated values copied to:– Aggregated Distribution Receipt or Aggregated Distribution Demand

(Planned) key figures, and – Aggregated Production (Planned) or Aggregated Dependent Demand

key figuresDetail view of the aggregated key figures you display lists orders that the system created for the sub products

© SAP 2007-2008 / 121

Aggregated Planning Process Steps (cont.)

Process steps for standard scenario (product location) (cont.)6. Check and adjust plan at product group level or detailed

levelExample – execute capacity leveling at product group level and not item levelAggregate and disaggregate data interactively before and after changes were madeCan be used for Aggregation only without disaggregation

© SAP 2007-2008 / 122

Aggregated Planning with SNP —Planning Book

PlanningBook

SeparateKey

Figures

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© SAP 2007-2008 / 123



© SAP 2007-2008 / 124

Integration of SNP with DP, PP/DS, and SAP ERP

Integration of SNP with DPIntegration of SNP with PP/DSIntegration of SNP/SAP APO with SAP ERP

© SAP 2007-2008 / 125

Planned Independent

Requirements

Integration of SNP with DP

Demand PlanningDemand Planning Supply Network PlanningSupply Network Planning

Macros/AlertsSNP Planning

Run

Forecasts

Feasible Sales Qty Production Plan

Release

to SNP

Release

to DP

Integration can go both waysFrom DP to SNPFrom SNP to DP

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© SAP 2007-2008 / 126

Release Demand Plan from DP to SNP

Demand Plan is transferred as Planned Independent Requirements (PIRs) to SNP

Demand plan/forecast is stored in buckets/times series data in DPPIRs are stored as orders in SNPFlexibility to have different/many PIRs per location product

Order category FA or FC

Demand Plan is released to a product locationAbility to break up forecast during release via:

Location splits Product splits

Ensure product location master data exits in SNP for all Characteristics Value Combinations (CVCs) in DP

DP has CVCs for product and location independent of SNPSNP needs to have corresponding product master maintained

Don't Forget

© SAP 2007-2008 / 127

Release Demand Plan from DP to SNP (cont.)

Offers flexibility to account for different time buckets in DP and SNP

Monthly, weekly, or daily splitCan vary over the planning horizon

Daily for short-term horizonWeekly for mid-term horizonMonthly for long-term horizon

User exit available for custom logicForecast created in DP can be transferred online or in the background to SNP

Typically done in background in a live environment

© SAP 2007-2008 / 128

Integration of DP with SNP

Forecast in Demand Planning – Stored in Time Buckets

Release Forecast to SNP

Planned Ind Req

Distribution Centers

Manufacturing Plants

Suppliers

Forecast

STO Planned OrderPurchase Order DC

SNP

DP

Planned Independent Req

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© SAP 2007-2008 / 129

Release of Forecast from DP to SNP

Provides the source of forecast data in Demand

Planning

Offers ability to transfer forecast

data to any planning version in SNP

Specifies mapping of forecasts to order category

Selection of products and

locations for which forecast will be

transferred to SNP

© SAP 2007-2008 / 130



© SAP 2007-2008 / 131

Conversion of SNP Orders to PP/DS Orders

PP/DS is a detailed planning and scheduling tool ideal for short-term planning

Detailed planning of manufacturing stepsScheduling/sequencing of individual orders

SNP is a bucketed planning tool ideal for mid- to long-term planning

Supply planning across the network to:Determine best sourcing optionCreate a constraint-based production plan in buckets

SAP offers seamless integration for converting orders from SNP to PP/DS through:

SNP production horizon and PP/DS horizonSNP production horizon separates PP/DS planning period from SNP planning period, or they could overlap

Conversion of SNP planned orders to PP/DS planned ordersSAP standard Heuristics are available to convert SNP orders to PP/DS orders inside the SNP horizon

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© SAP 2007-2008 / 132

Planning Process with Unique Planning Horizon

SNP Production Horizon starts after the PP/DS horizon SNP and PP/DS planning areas are unique, SNP orders for all products can be converted to PP/DS orders SNP is used for mid- to long-term planning while PP/DS is used for short-term planning

Today

PP/DS Horizon

SNP creates orders

Conversion

PP/DS schedules existing orders

SNP Production Horizon

Time

Time Fence

equals

© SAP 2007-2008 / 133

Planning Process with Common Planning Horizon

SNP Production Horizon starts within the PP/DS horizon SNP and PP/DS planning areas overlap, seamless integration of SNP planning into PP/DS planning Useful when SNP has control over certain products and their critical components

Today

PP/DS HorizonProduct A

SNP creates orders

Conversion

PP/DS schedules existing orders

SNP Production Horizon

Time

Time Fence

© SAP 2007-2008 / 134



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© SAP 2007-2008 / 135

Core Interface (CIF) to Integrate SAP ERP and SAP APO

The Core Interface (CIF) is responsible for data exchange between SAP APO and SAP ERPThe CIF is a real-time interface that can link an SAP APO system with multiple SAP ERP systemsThe CIF can perform initial transfer as well as subsequent data changes The CIF can transfer both master data (1 way) and transaction data (both ways)

© SAP 2007-2008 / 136

Core Interface for Transaction Data Transfer

SAP ERP Transaction DataSAP ERP Transaction Data SAP APO Transaction SAP APO Transaction DataData

Purchase Orders Purchase Orders (BF)

SAP ERPSAP ERP SAP APOSAP APO

Purchase Requisitions

Sales Orders

Planned Orders

Planned Independent Reqs

Reservations

Stocks

Purchase Requisitions (AG)

Planned Orders (AI)

Stocks (CC)

Initial Data Transfer

(Orders with Category)

Sales Orders (BM)

Forecast (FA)

Product Reservations (AM)

Real-Time Incremental

Data Transfer

© SAP 2007-2008 / 137

Customizing in SNP for Transfer of Data to SAP ERP

The above transaction indicates various options available for transfer of data from SNP to SAP ERP (tcode /SAPAPO/SDP110)Periodic transfer is preferred when large volumes of orders are generated, typically after a planning or TLB run

But might be driven by process needs, too (user to review ordersbefore sending to SAP ERP, especially for TLB orders)

Options available for transfer of SNP orders

Options for transferring orders generated from deployment process

Options for transferring orders generated from the

TLB run

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© SAP 2007-2008 / 138

Monitoring/Error Handling of CIF

Standard features/tools provided in SAP ERP to monitor the interfaces between SAP APO and SAP ERP

Similar to any other Remote Function Call (RFC) and Application Link Enabling (ALE) monitoring transactions

Additional tools provided in SAP APO Supply Chain Management (SCM) Queue Manager transaction

Provided to manage and process delays in the interfaceOffers link to application log to perform error analysis

Delta report to compare and reconcile data between SAP APO and SAP ERP

Using the reconcile function, transaction data can be brought back in sync between the two systems after any disruptions in the interface

© SAP 2007-2008 / 139

Tools in SAP APO to Monitor CIF Interface

SCM Queue Manager is a tool provided in SAP APO to monitor and resolve queues in the core interface between SAP APO and SAP ERPProvides access to the application log for detailed error analysisTransaction /n/SAPAPO/cq in SAP APO

Application LogIndicates data held up due to an error

Queues by order types that are held up in the interface

© SAP 2007-2008 / 140

Option to resend stocks from SAP ERP to SAP

APO

Result of running the Delta report for stocks

CIF Delta Report for Transaction Data

SAP-provided transaction to compare and reconcile transaction data between SAP APO and SAP ERPAbility to select specific transaction data for selection of products and locationsAbility to execute in real time or in the backgroundCan be accessed in SAP APO using tcode /n/SAPAPO/ccr

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© SAP 2007-2008 / 141

CIF User Exits/BAdIs

SAP provides a number of user exits to customize data transfer between SAP ERP and SAP APO

Available for master data and transaction dataSuitable user exit can be in SAP ERP or SAP APO

Available CIF user exits/BAdIs in SAP ERPApproximately 31 user exits and 8 BAdIsExamples:

CIFMAT01 Enhancement for Transferring Customer-Specific Matl Fields

CIFLOC01 Enhancement for Transferring Customer-Specific Loc. Fields

CIFCID3 User Exits for Deltareport3

© SAP 2007-2008 / 142

CIF User Exits/BAdIs (cont.)

Available CIF user exits/BAdIs in SAP APOApproximately 56 user exits and 7 BAdIsExamples:

SAP APOCF008 Inbound Processing: ResourcesSAP APOCF010 Inbound Processing: Sales OrderSAP APOCF011 Inbound Processing: Stock

Should plan on utilizing some of these CIF user exitsor BAdIs

Using half a dozen to a dozen of them is not uncommon

© SAP 2007-2008 / 143



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© SAP 2007-2008 / 144

Resources

Presentations“Production Master Data Overview and Strategy by BSG Manufacturing Industries,” SAP AGDr. Dirk Meier-Barthold, “Supply Chain Safety Stock Planning,” SAP AGGunter Fertig, “Multi-Level Supply and Demand Matching (CTM),” SAP AGSAPPHIRE 2006 Supplier Collaboration with SAP SNC by BearingPointCTM Workshop 11/2007 – Balaji Rao Gaddam

© SAP 2007-2008 / 145

Resources (cont.)

On your conference CD:73 additional slides discussing key implementation considerations and challenges Supply Chain Engineer (SCE) PrimerHow to Configure Capacity Variants/Intervals in SNPSolution Brief of the SNP Extended Horizon CapabilityDetails on Calendar use in SNP and PP/DSList of Parameter IDs (PIDs) to use in APO for more efficient system performanceCopy of SCM Maintenance Jobs to Schedule and ExecuteHelp on Notes Management

© SAP 2007-2008 / 146

7 Key Points to Take Home

SNP is a mid- to long-term planning tool and is used to create feasible supply plans (Rough Cut Planning)Know your business requirements and why you’re implementing SAP APO SNP to:

Select the most appropriate planning methods and special planning featuresRealize the kind of benefits desired at the beginning of the project

SNP has 3 planning solvers to select from depending on the business requirements:

Heuristics/Capacity Leveling – 2 stepsCapable to Match (CTM) finite planOptimizer

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© SAP 2007-2008 / 147

7 Key Points to Take Home (cont.)

The SNP Optimizer and CTM in SAP APO 5.0 now have an explanation tool that lets the user see planning messages to better explain planning situations

This was not available previously Tightly integrate the Business into the project by:

Having business users as full-time team members on the projectEducating the business community about SAP APO SNP functionality and new processes throughout all project phases, not just at the end right before go-live

© SAP 2007-2008 / 148

7 Key Points to Take Home (cont.)

Don’t underestimate the effort required to set up and monitor the CIF for interfacing SAP APO with SAP ERP

There will be ABAP development for the CIF user exits

Master data objects are very important to executing a good plan in SNP. Most master data is transferred via CIF from SAP ERP.

Mixed resources can be used in SNP and PP/DSNew production planning object, SNP PDS, can be transferred directly from SAP ERP to SAP APO without a separate program

© SAP 2007-2008 / 149

Your Turn!

How to contact me:Claudio Gonzalez

[email protected]

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© SAP 2007-2008 / 150

Copyright 2007-2008 SAP AGAll rights reservedNo part of this publication may be reproduced or transmitted in any form or for any purpose without the express permission of SAP AG. The information contained herein may be changed without prior notice.Some software products marketed by SAP AG and its distributors contain proprietary software components of other software vendors.SAP, R/3, mySAP, mySAP.com, xApps, xApp, SAP NetWeaver, Duet, Business ByDesign, ByDesign, PartnerEdge and other SAP products and services mentioned herein as well as their respective logos are trademarks or registered trademarks of SAP AG in Germany and in several other countries all over the world. All other product and service names mentioned and associated logos displayed are the trademarks of their respective companies. Data contained in this document serves informational purposes only. National product specifications may vary.

The information in this document is proprietary to SAP. This document is a preliminary version and not subject to your license agreement or any other agreement with SAP. This document contains only intended strategies, developments, and functionalities of the SAP® product and is not intended to be binding upon SAP to any particular course of business, product strategy, and/or development. SAP assumes no responsibility for errors or omissions in this document. SAP does not warrant the accuracy or completeness of the information, text, graphics, links, or other items contained within this material. This document is provided without a warranty of any kind, either express or implied, including but not limited to the implied warranties of merchantability, fitness for a particular purpose, or non-infringement.SAP shall have no liability for damages of any kind including without limitation direct, special, indirect, or consequential damages that may result from the use of these materials. This limitation shall not apply in cases of intent or gross negligence.The statutory liability for personal injury and defective products is not affected. SAP has no control over the information that you may access through the use of hot links contained in these materials and does not endorse your use of third-party Web pages nor provide any warranty whatsoever relating to third-party Web pages

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2. sap supplier network planning (snp)26125069

Documents

snp planning functionalitymid

snpintegration of snp

days sap

overall planning process

cover overview of snp

sap erpwrap

sap modules

narrowsap apo snp