plm150-engineeringchangeandconfigurationmanagement

SCM200 Überblick Supply Chain Planung

SCM200

Release 640 04/06/2006

0

SAP AG 2003

SCM200 Überblick Supply Chain Planung

THE BEST-RUN E-BUSINESSES RUN SAP

© SAP AG 2003

SCM200Supply Chain Planning Overview

Software Components: SAP R/3 ERP, SAP APO 3.1 2003/Q3 Material number: 50063056

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Copyright 2004 SAP AG. All rights reserved.

No 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.

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Target Group and Prerequisites

Target Group

The target audience of this course is project team members and key users who are responsible for the introduction of Supply Chain Planning using mySAP SCM.

SAPSCM (mySAP SCM Overview)

Recommended: PLM100 (Lifecycle Data Management)

Prerequisite

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Course Goals

Course Objectives

Course Content

Course Overview Diagram

Main Business Scenario

mySAP Supply Chain Management (mySAP SCM)

Key Functional Area Planning

Contents:

Course Overview

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This course will prepare you to

Gain a basic understanding of SAP functions in the area of Supply Chain Planning

Describe the possibilities of Supply Chain Planning in the mySAP components R/3 and APO

Understand the interplay of SAP R/3 and SAP APO in Supply Chain Planning

Specify the advantages of the different possibilities of Supply Chain Planning

Course Goals

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At the conclusion of this course, you will be able to:

Describe the role of the mySAP components R/3 and APO in Supply Chain Planning

Specify which master data and transaction data are used in Supply Chain Planning

Explain the integration of SAP R/3 and SAP APO

Carry out fundamental planning functions: Demand Planning, Demand Management, Supply Network Planning, Material Requirements Planning.

Course Objectives

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Unit 5 Supply Network Planning

Unit 6 Material Requirements Planning

Unit 7 Production Planning/ Detailed Scheduling

Unit 8 Conclusion

Unit 1 Course Overview

Unit 2 Master Data and Transaction Data

Unit 3 Demand Planning

Unit 4 Demand Management

Preface

Appendix

Course Content

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Overview Diagram (1)

Demand Planning

Master Data and Transaction Data

Course Overview

Material Requirements Planning

Demand Management

Supply Network Planning

Production Planning and Detailed Scheduling

Conclusion

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You are a member of the project team responsible for implementing Supply Chain Planning functions

Taking the Precision Pump company as an example, you familiarize yourself with the functions of Supply Chain Planning. The Precision Pump Company offers various high-tech standard pumps.

Having predicted future requirements in Demand Planning, you first of all plan your cross-plant procurement network.Finally, in the short-term horizon, you plan the production in your production plants.

Main Business Scenario

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Key Functional Areas of mySAP SCM

mySAP SCM

SC Exchange(Collaboration)

SC Event andPerformance Management

Planning Manufacturing

Solution:

Key Functional Area

External Procurement

Sales Processes and Logistics Execution

Supply Chain Exchange (Collaboration): Supports central, Internet-enabled cross-enterprise e-business processes; the exchange and update of data with partners via a Web browser, using current Internet security standards. Supply Chain Event Management and Supply Chain Performance Management: Monitor all procurement, delivery, production, storage, and transport processes based on exception messages (alerts), status reports and on real-time measurements of total output and total effectivity.

Planning: Forecasts market developments; promotion planning; planning of invoiced sales and requirements by taking past figures into account; planning of requirements coverage of different sources of supply; permanent updating and synchronisation of supply plans; derivation of production requirements along the complete procurement network for producers and notification of production progress to partners; multilevel planning, lifecycle management, causal and capacity analyses, quota arrangements, product allocations and availability checks are also integrated.

Production: Supports discrete production (order-based or period-based) and process manufacturing from planning to realization; creates feasible machine scheduling plans by taking the availability of materials, capacity and production resources and tools into account.

External procurement: Covers the complete procurement process from purchase requisition via sourcing, purchase order, goods receipt and invoice verification to inventory management; supports Internet-based direct procurement; makes use of e-marketplaces, catalogs and rules-based procurement strategies for automated procurement.

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Sales and Distribution processes and logistic execution: Manages sales orders using offer creation, determination of delivery date, Global Available-to-Promise, picking, assignment of invoices; transport management using transport planning and vehicle scheduling; tracking of deliveries.

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CoreInterface

Key Functional Area Planning - SAP Components

SAPR/3

Plug-In

SAPAPO

SAPBW

...

Enterprise Portal: Consistent access to all components

Administration of customer demand

Production Planning in plant

Production processing...

Reporting Prediction of demand Supply Network

Planning Quantity and capacity

requirements planning

... Optimization

The SCM key functional area planning primarily uses the following mySAP components: SAP R/3, SAP APO (Advanced Planner and Optimizer), SAP BW (Business Information Warehouse)

The interfaces which are responsible for the integration of SAP R/3 with BW or SAP APO are made available via a corresponding Plug-In. The interface between SAP R/3 and SAP APO is called the Core Interface (CIF).

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Supply Chain Planning Scenario

Supply ChainLe

ad ti

me

Del

iver

y tim

e

Suppliers

Plants

Customers

DCs

Push

Pull

The fundamental problem of Supply Chain Planning is that the delivery time of products to customers is supposed to be substantially shorter than production time or lead-time. To reach this target, stocks, or rather safety stocks usually have to be created on component level or finished product level in plants or distribution centers (DC).

You use postponement strategies to define how far the sales order links with the supply chain; in other words, at which point the decoupling of make-to-stock production (push strategies), and make-to-order production (pull strategies), takes place.

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Supply Chain Planning at a Glance

BWLIS

SC Manufacturing / Procurement

APOAPO

R/3R/3

Flexible PlanningStandard SOP

Sales Global Available-to-Promise

Supply Network Planning (SNP)

Production Planning/Detailed

Scheduling (PP/DS)

Material Requirements Planning (MRP)

Demand Management

Capacity Requirements

Planning (CRP)Transportation

Planning & Vehicle Scheduling (TP/VS)

Demand Planning (DP)

Generally speaking, Supply Chain Planning can be divided into many steps. To execute these steps, different SAP R/3 and SAP APO components are available. It is therefore possible and sensible to utilize both systems in an integrated connection for planning. Integration between the systems takes place using the Core Interface (CIF).

Demand Planning, where past sales figures are used to derive a future demand program, can be executed within the framework of flexible planning in SAP R/3 (with the exception of standard Sales & Operations Planning (SOP)), or within Demand Planning (DP) in SAP APO.

Demand Management in its true sense takes place in SAP R/3. It is also possible however to derive planned independent requirements from SAP APO DP.

In principle, sales orders are created in the SAP R/3 System. The ATP check of a sales order can take place globally in SAP APO (integration with PP/DS is also possible).

Cross-plant planning is possible using Supply Network Planning in SAP APO. Material Requirements Planning can be executed in SAP R/3 or SAP APO. Whereas in SAP R/3

capacity requirements planning is executed separately in a second step, in SAP APO PP/DS (Production Planning/ Detailed Scheduling), quantities and capacities can be planned simultaneously.

Execution of production, in other words, the processing of production orders (production or process orders) takes place in the area of Supply Chain Manufacturing.


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Interenterprise Demand Planning (Internet-based)

Consistent and consolidated plans

Statistical and causal forecasting techniques

Lifecycle planning Promotion planning

Demand Planning (1)

Functions of Demand Planning

Supply Chain

Demand Planning is a complex, powerful, and flexible tool that supports your enterprise's demand planning process. The result of the forecast is typically reflected in the form of demand forecasts on distribution center level or directly in production plants.

User-specific planning layouts of planning books enable you to include different departments or even other enterprises in the forecasting process. With APO Demand Planning you can use statistical forecasting methods and advanced macro techniques to do the following: - Create forecasts from sales history, based on many different causal factors; - Test predefined, and user-defined forecast models, and forecast results; - And use a consensus-based approach to consolidate the demand plans of different departments. You can use forecast overrides and promotions to add marketing intelligence and management adjustments.


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Demand Planning (2)

Flexible Planning (R/3 SOP) and Demand Planning (APO DP)

Aggregated historical data

Future demand forecast

Statistical forecasting Collaborative forecasting Promotions

Planning levels, for example:

SAP R/3ExcelNon-SAP system

Incoming ordersQuantitiesValues

Billing documentQuantitiesValues

SAP BW

LocationProduct hierarchySold-to partyRegion

Demand Planning can be executed in SAP R/3 within the framework of flexible planning (Sales & Operations Planning) or in SAP APO using the component Demand Planning (DP).

In Demand Planning, a forecast based on aggregated historical data is executed. This historical data can stem from the SAP R/3 Logistics Information System (SAP R/3 LIS) or from the SAP Business Warehouse (SAP BW). The structure and processing of planning data can be defined extremely flexibly using the respective data structures of SAP R/3 LIS or SAP BW - as a rule, these are based on the usage of so-called characteristics (for example, location and sold-to-party) according to which key performance indicators (for example, invoiced sales quantity) can be itemized.


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Demand Management

Planned independent requirements and sales orders

Forecast

Warehouse requirements

Customer requirements

Demand program

Material Requirements PlanningCoverage of requirements through

In-house production External procurement Stock transfer in own network

Plnd. indep.reqmts.

Salesorders

Sales

Demand Management pertains to the administration of so-called independent requirements. The way in which independent requirements behave in Material Requirements Planning (for example, if they affect requirements, if they consume other requirements) can be determined by their requirement type or their planning strategy.

Planned independent requirements are warehouse requirements that can be derived from a forecast of the future requirement situation. In make-to-stock production, you want to initiate the procurement of the materials concerned, without having to wait for concrete sales orders. Using such a procedure, delivery times can be shortened on the one hand, and on the other hand, it is possible, through foresighted planning, to debit one's own production resources as evenly as possible.

Sales orders (customer independent requirements) are created by sales and distribution. Customer requirements can be received directly in Material Requirements Planning, independently of their defined requirements type. This is desired when customer-specific planning takes place.

Sales orders can serve as exclusive requirements sources, for which procurement is then specifically triggered (make-to-order production), or, together with planned independent requirements, they can create the total demand. Consumption is also possible with planned independent requirements.


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Planning of material flow along the supply chain

Planning of the mid- to long-term horizon

Finite Supply Network Planning, bucket-oriented

Prioritization of demands; supplyoptimization

Result: Feasible plans

Supply Chain

Supply Network Planning, which you can carry out using the component SAP APO SNP, usually takes place in the mid- to long-term horizon, that is, outside of the production horizon. This is based on the requirements that you have determined for the distribution centers in Demand Planning. These requirements should be covered by the distribution centers, production plants and suppliers in your network.

Planning can be executed finitely. In this way, the production, warehouse or transport resources of your network can already be taken into account in rough-cut planning. In principle, planning in SNP takes place based on so-called time buckets, that is, on the basis of freely defined time bucket profiles (the smallest unit in SNP is one day). In terms of performance, this kind of bucket-oriented planning is much better than Detailed Scheduling in SAP APO PP/DS, so that planning of more complex networks is also possible.

Network planning within SNP takes place in two steps: During the first step, in the actual planning, stock transfers are created to optimally distribute and meet the requirements in the network. This means, for example, that the demands of a distribution center are partially met through stock transfer from two production plants. After production has taken place in the production plants, a second step is carried out: Execution of planning within deployment. In deployment, SNP planned orders are converted into deployment orders, based on the quantities actually produced, and stock transfers are then triggered.

In SAP APO SNP, different planning and optimization methods are available.


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Transition from Medium to Short-Term Planning

Supply Network Planning SNP BOM and routing Finite cross-plant planning Distribution and procurement Quantity-oriented and bucket-oriented No pegging

SNP planned ordersPurch. requis.Stock transfers

Production BOM and routing Finite, detailed planning per plant Sequences and setup times Continuous and order-related Pegging

Production Planning/Detailed Scheduling

Planned ordersPurch. requis.Stock transfers

TimePP/DS horizonSNP production horizon

Today

Plnd. Ind. Reqmts

SalesOrders

Plnd. Ind. Reqmts

SalesOrders

Network planning within SAP APO SNP takes place outside of the SNP production horizon. In the PP/DS horizon, however, Production Planning/Detailed Scheduling takes place, that is, detailed planning of procurement in a plant. It is possible, and also makes sense that the two horizons overlap, and that the PP/DS horizon is behind the SNP production horizon.

SNP Planning is based on SNP bills of material and routings, most of which are usually simplified production plans. SNP bills of material , for example, usually contain only the strategically important components for which foresighted planning is necessary, whereas procurement of the remaining components is only planned in plant-specific Detailed Scheduling. SNP planned orders that are based on this simplified master data can be converted into planned orders in Detailed Scheduling.

Pegging is the link between receipts and issues along the supply chain. When an order is shifted, all dependent orders can be adjusted automatically. This function is only available in Production Planning and Detailed Scheduling. Supply Network Planning is based purely on quantities and buckets.


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TimeToday When does procurement need to begin?


Material Requirements Planning in multilevel production

Op. 30Op. 20Op. 10

Planned order Finished product

Dependent requirement

Assembly 110 20 30 40

Order raw material A

RequirementWhen will production

take place?

When are the components required?

Bill of material

Material Requirements Planning is the first step of Production Planning/Detailed Scheduling, which, as a rule, you carry out in the short-term horizon in the plant.

In Material Requirements Planning, which you can execute in SAP R/3 (SAP R/3 MRP: Material Requirements Planning) or in SAP APO (SAP APO PP/DS: Production Planning/Detailed Scheduling) procurement dates for necessary assemblies and components are determined based on the requirements dates for the finished product (a sales order, for example).

Scheduling of procurement for products produced in-house is carried out on the basis of a routing. A routing specifies which production operations need to be executed and how long the individual operations last. At the beginning of production of the finished product, the assemblies (from the bill of materials) that are needed for production must be available. Procurement of these assemblies must be initiated earlier accordingly. In this way, assuming the dependent requirements date is the availability date, the system determines the basic order dates of the components by means of backward scheduling using the in-house production time or the planned delivery time.


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Production Planning/Detailed Scheduling (PP/DS) (1)

Functions of PP/DS

Supply Chain

To-the-minute planning of production, external procurement, and stock transfer within the production plant

Capacity requirements planning (SAP R/3 CRP) as a separate step or simultaneous material and capacity requirements planning (SAP APO PP/DS) on operational level in the short-term area

Schedule optimization regarding sequences and lead-times (SAP APO PP/DS)

To-the-minute Production Planning in the production plant can take place in SAP R/3 or SAP APO. Planning in SAP APO PP/DS in particular offers extensive Production Planning/Detailed Scheduling possibilities.

Production Planning and Detailed Scheduling (SAP APO PP/DS) is used mainly for short-term to the minute planning (both for in-house production and external procurement) in the production plant. PP/DS schedules and plans all operations of an order that are relevant for planning at the different resources.

In PP/DS, requirements are met by generating planned orders (to plan in-house production) as well as purchase requisitions or schedule lines (to plan external procurement). Simultaneous material and capacity requirements planning can be used to do this: You can define resources as “finite” resources (planning-critical resources) in the resource master. Order operations are only created at these resources if there is sufficient capacity for the order quantity on the corresponding date. If there is not enough capacity available, the system searches for a new date, taking the capacity situation into account.

Within the framework of SAP APO PP/DS, schedule optimization is possible: It may be that, during planning, orders that do not have an optimal order sequence have been generated. You can change the sequence and resource assignment of existing orders in the optimization run.

PP/DS is a planning tool. Execution functions such as confirmations and goods receipts are created in SAP R/3. You should therefore transfer planning results to SAP R/3 when planning in SAP APO.


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TimeToday

Production Planning/Detailed Scheduling (PP/DS) (2)

Simultaneous quantity and capacity requirements planning (SAP APO PP/DS)

Resource 3 (finite)

Resource 2 (infinite)

Resource 1 (finite)

30

20

30

20

Confirmedqty/date

AvailableOccupied

1st Loading AttemptFinal Loading Attempt

1010

Operations and resource load according to production process model

Sales order with desired date and quantity

If a product is not available, the requirement (the sales order or dependent requirement, for example) triggers production directly: If it triggers an order for in-house production, SAP APO creates a planned order for the desired quantity in PP/DS. All operations of the production process model (PPM; SAP APO master data record, which contains the bill of material and routing of SAP R/3) are scheduled at the resources of the PPM, whereby the system can take capacity constraints into account (available capacity and potentially orders that have already been scheduled).

If a finitely planned resource is already exhausted on the desired date, the system searches for a new date on which the planned order can be created. You use the so-called strategy profile to define how the system is to schedule (search for a slot, infinite planning ...).


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SAP APO Planning with SAP R/3 Integration

APOR/3

Conversion

Supply Network Planning (SNP)Production Planning (PP/DS)

Consumption

Deploy-ment

Planned order Production order

Purchase requisition Purchase order

Stock transport requisition Stock transport order


Plnd. ind. reqmts

Sales order

Production Planning (PP)

Flexible planning

Plnd. ind. reqmtsDemand Management

Sales orderSales (SD)

Purchasing (MM)

Release, confirmations


Purchase requisition Purchase order


The mySAP component SAP APO is a planning tool that cannot be utilized on its own. During planning, SAP APO relies on data from SAP R/3 (stocks or sales orders, for example) on the one hand; on the other hand, the execution of dates and quantities planned in SAP APO takes place in SAP R/3. The planning process in SAP APO therefore is linked to a permanent exchange of data between SAP APO and SAP R/3.

Planned independent requirements, for example, can be the result of Demand Planning in SAP APO itself. For further planning, these planned independent requirements can be released to SAP APO SNP or transferred toR/3.

Sales orders and planned independent requirements form the starting point for both Supply Network Planning (SNP) and Production Planning and Detailed Scheduling (PP/DS) in SAP APO. Existing storage location stock is also included in the planning. Sales orders are entered in SAP R/3 and are transferred to SAP APO via the SAP R/3 APO interface (CIF: Core Interface).

In Supply Network Planning (SNP) you plan for the short- or mid-term horizon for the entire supply chain: you generate stock transport requisitions (for planning and stock transfer) between distribution centers and plants, and can also generate planned orders (for in-house production planning) and purchase requisitions (for external procurement planning) directly in the production plant for the longer term horizon. In Production Planning and Detailed Scheduling however, you usually generate planned orders and purchase requisitions directly in the production plant for the short-term horizon. Transaction data


generated in SAP APO is transferred to the SAP R/3 System for execution via the SAP R/3 APO interface (CIF: Core Interface).


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Supply Chain Planning, which in essence is realizedusing the mySAP components SAP R/3 and SAP APO, is a key functional area of mySAP SCM.

Operative planning takes place on different levels along the supply chain: Demand Planning for requirement forecast on an aggregated level, Supply Network Planning in rough time-buckets, to-the-minute Production Planning and Detailed Scheduling in production plants.

SAP APO works as a planning tool together with SAP R/3. The integration of both components is an important element of the planning process.

Course Overview: Unit Summary


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SAP R/3 master data

SAP APO master data

Integration of master data

CIF Interface

Transaction data

Planning and production

Contents:


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Specify which master data is used in Supply Chain Planning in SAP R/3 and SAP APO

Explain the integration of master data using the CIF interface

Describe the principal functions of the CIF interface

Explain the transfer of transaction data between SAP R/3 and SAP APO

Explain the role of transaction data integration in planning and production

At the conclusion of this unit, you will be able to:

Master and Transaction Data: Unit Objectives

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Course Overview Diagram (2)

Demand Planning


Course Overview


Demand Management



Conclusion

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Data Flow in Supply Chain Planning

SC Manufacturing/Procurement

APOAPO

R/3R/3

Flexible Planning Demand Planning (DP)

Sales Global Available-to-Promise (ATP)



Scheduling (PP/DS)


Demand Management

Capacity Requirements Planning (CRP)

Transportation Planning & Vehicle Scheduling (TP/VS)

Materials, Bills of Material,

Routings, ...

Planned Orders, Orders, Dates, ...

Generally speaking, supply chain planning is divided into many steps, some of which can be executed by components in SAP R/3 and others which can be executed in SAP APO. It is possible and advisable to integrate these two systems and use both together when planning. It is then necessary to exchange a large number of data objects between both systems: Master Data should be transferred from SAP R/3 to SAP APO, Planning results should be transferred back (published) from SAP APO to SAP R/3 and so on. Integration between the systems takes place through the APO Core Interface (CIF).

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Master Data Objects in the Supply Chain

Suppliers

Plants

Customers

DCs

External Procurement Relationships

Transportation lanes

Materials

Resources

Bills of material

Routings...

Supply chain master data objects are usually created in SAP R/3: Plants, distribution centers (DCs), vendors, and customers. Supply chain planning concerns materials that are defined as material masters. For plants that produce aswell as plan, you also have to create resources, bills of material (BOMs), and routings in addition to the materials for planning. Between the individual locations of the Supply Chain (that is plants, vendors and so on), transportation lanes are defined, and these define material flow through the Supply Chain.

Even when using an SAP APO system for supply chain planning, master data is generally created in a connected SAP R/3 system and transferred to SAP APO from there. Only master data that exists purely in SAP APO and has no counterpart in SAP R/3 is to be created in the SAP APO system.

In SAP APO, transportation lanes are used to connect together a network of plants and DCs so that stock transfers can be planned between these locations. Corresponding lanes can also be maintained in SAP R/3 (in the form of special procurement keys, for example). At this point in time, it is not possible for these keys to be transferred to SAP APO.

The supply relationship between a vendor and a plant is created in SAP R/3 in the form of a purchasing info record or outline agreement. When you transfer these external procurement relationships to SAP APO, they are also displayed there as external procurement relationships. A corresponding transportation lane is created at the same time.

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Plants and Distribution Centers

Plant

Name

Definition of a plant

Street Broadway 691Town 10001 New York

Country US

New York

1000

USA

Definition of a DCPlant Node type Name1000 New York

DC2400 DC Milano

...

Planning Production External procurement Requirements entry Inventory management...

Is this plant a DC?

Storage locations in plant 10000001

Finished goods warehouse0002

Material storage

Differentiation of inventory within a plant

A plant is an organisational unit that subdivides an enterprise into production, procurement, stockholding or material planning. In a plant, materials can be produced or goods and services can be staged.

You specify an address, a language, a country assignment and a factory calendar for a plant. If SAP APO is to be used for Supply Chain Planning, the plants can be transferred from SAP R/3 to SAP APO.

Distribution Centers (DCs) are predominantly plants, from which products are sold or which generally serves merchandise distribution. They only differ functionally from plants via a corresponding entry in SAP R/3 Customizing, that is, a plant also contains full sales and distribution functions, just as products can be produced in a DC. Plants and DCs are represented by different symbols in the Supply Chain.

One or more storage locations can be defined within a plant. A storage location specifies where a material is stored. Storage locations thus enable a differentiation of material stocks within a plant.

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Customers and Suppliers

Debtor

Name

Definition of a customer

Street Calvinstr. 36

Town 13467 Berlin

Becker Berlin

K1000

...

Creditor

Name

Definition of a supplier

Street Kolpingstr. 1

Town 12001 Berlin

C. E. B. Berlin

L1000

...

Control of Sales and Distribution Processing

Control of Purchasing Management

Customers and suppliers are defined as business partners in the SAP R/3 System; they enable the control of different sales, or rather purchasing processes.

Sales and Distribution processing as such plays no role in SAP APO. Customer master records can be transferred to SAP APO as coresponding locations to plan the transportation of a product to a customer,

Source determination for external procurement can take place in SAP R/3 or SAP APO. Supplier master records can be transferred to the SAP APO System for planning in SAP APO. Purchase order handling, goods receipt and invoice verification takes place in SAP R/3.

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External Procurement Relationships

Supplier

Material

Purchasing info record

Planned delivery time7 days

SCREWS

L1000

Plant 1000

Costs EUR 12/BOX

Transportation lanes

External procurementrelationships

Or outline agreement

Transportation laneLocation 1000 -> 2400PUMP Priority 0 1 to 1000 pieces

Truck Duration: 1 day Cost: EUR 8 ...

...

APO

To transfer products between two locations in the Supply Chain, from a production plant to a distribution center, for example, a corresponding transportation lane has to exist. Transportation lanes are created in SAP APO for this reason; the information that corresponds to a transportation lane, for example, a special procurement key, can be created in SAP R/3, in the material master.

Purchasing info records or outline agreements, with which you create price and supply agreements with certain suppliers in SAP R/3, can be transferred to the SAP APO System as external procurement relationships. In addition, a corresponding transportation lane is created.

In principle, transportation lanes are product-specific. They can be effective for all products, however. A transportation lane contains one or more means of transport that determine how the product can be transported (for example, by truck or barge). Moreover, costs and durations can be determined. On the basis of priorities, decisions can be made about stock transports.

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Materials (1)

Global and Location-Specific Data

Material PUMP

Global data

Data DC 2400

Data plant 1000

Planning of material flow along the Supply Chain takes place at material level. Materials are defined by corresponding material masters. SAP R/3 material masters can be transferred to SAP APO as product masters.

A material master contains global data that is valid cross-location (for example, the information for this material is the same in all production plants), and location-specific data, which contains different settings for each relevant location (for example, a certain production plant). General data such as the measurements or the weight of a material is set globally, whereas settings for planning are usually predefined locally. This data, then, can differ depending on location.

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Materials (2)

Assignment of Data in Views

Material master PUMPMRPSalesBasic Data

Division

Mat. grp.

01

001

Weight

Volume

280 KG

0.8 M3

Buyer

Purch.value

002

Proc. type

Strategy

E

40

Val. class

Price

7920

EUR 300...

... ...

... ...

...Purch. Accounting

All information on procurement, production, storage or sales

Settings for Supply Chain Planning

To provide a clear display, material master data is subdivided into views. In part, these views are globally valid (basic data, for example) and partly also location-specific (material requirements planning, for example).

The material master is the data object that contains all information necessary for the business use of a material, in particular, all settings for procurement, production, storage or sales. Not all settings in the material master are relevant for Supply Chain Planning. The settings partly apply rather to evaluation and sales management SAP R/3-specific functions.

Supply Chain Planning-relevant settings are largely found in the Materials Planning views. Procurement type or planning strategy, for example, is determined here. In different locations, these settings can be maintained entirely differently.


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SAP AG 2003

Settings for Supply Chain Planning

Materials (3)

Material master PUMP

MRP type

MRP 1 MRP 4...MRP

Lot size EX

Procurement type E

In-house prod. time 8 days

Safety stock 20 pc

Strategy group 40Availability check group 02

Production versions

0001 Normal production

How should I plan material requirements?

How much needs to be procured?

Will the material be produced in-house or procured externally?

Do I need to plan a safety stock? How should I plan?

How does the ATP Check take place?

What production procedure should I use?

The fundamental settings for Supply Chain Planning can be found in Material Planning views 1 to 4 of the SAP R/3 material master.

The MRP type specifies how a material should be planned (MRP, consumption-based planning, no planning).

The lot-sizing procedure determines the lot size of each of the procurement proposals. The procurement type controls how a material is to be procured (in-house production or external procurement). The in-house production time or rather the planned delivery time specifies how long procurement will last.

A safety stock can be set. The behavior of planned independent requirements is controlled by the strategy group. Moreover,

control of the ATP check takes place on the basis of the availability check group. A production procedure can be defined by a production version. In a production version, routing and

BOM can be selected in particular.


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Pump P-100

Bills of Material (BOM) (1)

BOM PUMPMaterial P-100 PumpPlant 1000

Usage 1 Production

Base quantity 1 pc

Item100-1000010 Casing 1 pc

100-2000020 Fly wheel 1 pc

100-3000030 Hollow shaft 1 pc

100-4000040 Electronic turbo-drive 1 pc

100-1300050 Hexagon head screw 8 pc

0010

0020

0030

0040

Bills of material are single-level

Items of a bill of material can themselves contain a further bill of material

The BOM contains the assemblies or components, that are to be included in the production of a material. SAP R/3 BOMs can be transferred to SAP APO in the form of production process models (PPMs).

BOMs are used in Material Requirements Planning, production, procurement and for product costing. A BOM consists of a BOM header and the BOM items. The base qauntity in the BOM header specifies

to which amount of the finished product the item quantities refer. Bills of material are single-level. An item of a BOM can itself also contain components. In this way,

multilevel production is described using the single-level BOMs of the finished product and those of the assemblies and where required, using the BOMs of the assemblies of the assemblies and so on.

A BOM can also contain documents or text items in addition to stock items that are required for the finished product.


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Bills of Material (BOM) (2)

BOM Structure

BOM PUMPMaterial P-100

Plant 1000

Usage 1

Base Quantity 1 pc

Item100-1000010

100-2000020

100-3000030

100-4000040

100-1300050

for example, Stock itemNon-stock itemVariable-size ItemDocument item

Status

Description Validity

Lot size area

Header

Item category

Descriptions

Quantities

Control data

Items1 pc

1 pc

1 pc

1 pc

8 pc

The settings that apply for the whole BOM can be found in the BOM header. BOM usage determines the business applications for which a BOM can be used. The status of the BOM controls whether the BOM is active for particular applications (MRP, for example).

Multiple BOMs, which consist of multiple alternative BOMs, can also exist in addition to simple BOMs. The different alternative BOMs can then be valid for each of the different lot-size areas, for example.

Components necessary for the production of the finished product are entered as items of the BOM. The item category specifies what kind of item you are dealing with: Stock items are executed in the warehouse and are used in production. In contrast, non-stock items are directly assigned to a manufacturing order (and not via the warehouse). Variable-size items contain variable-size data (a steel sheet with a certain surface area, for example) and finally, document items contain a supplementary document that describes production (a kind of design and construction diagram).

Individual items themselves can also bear a multitude of further settings, which then only refer to the respective item.


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Work Centers (1)

Which work centers are available for production?

Final Assembly Work Center (Plant 1000)CostingSchedulingCapacitiesDefault ValueBasic Data

What time elements (standard values) should be considered in planning?

What capacities are used in this work center?

What available capacity is staged?

What capacity category is relevant to scheduling?

How long do the individual steps (setup, processing, tear down) take?

What costs are incurred during processing?

A work center is the place where an operation or an activity is carried out in a plant. It therefore specifies where production ultimately takes place. Work places are used in routings (or also in networks, inspection plans (Quality Management) or in maintenance task lists). SAP R/3 work centers can be transferred to SAP APO as resources in the form of their capacities.

A work center is generally a certain geographical place in the plant, for example a certain machine or department of a plant.

The data of a work center is arranged into different views according to topic. In particular, the available capacity of the particular work center and the data needed to calculate the costing of work completed is stored in the work center. Using default values, data that has to be transferred into the operation of the routing or which serves as a reference, is stored.


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Work Centers (2)

Work Center Capacities

Capacities

Capacity cat. 001

Machine capacity

Final Assembly Work Center

Standard avail. cap.Working times

Resource utilization

Available capacity01Factory calend. ID

No. indiv.capacities

7:00 to15:00

100%

Standard avail. cap.Working times

Resource utilization

Available capacityFactory calend. ID

No. indiv.capacities

Capacity cat. 002

Labor capacity

Working times Break times Interval of avail. cap. Shifts

Always state:

Formulas for capacity

requirements

Formulas for capacity

requirements

01

3

7:00 to15:00

100%

1

The capacities that are available to a work center are explicitly specified in the work center. More than one capacity per work center can thus be used. For example, a work center can be assigned a machine capacity and a labor capacity.

The capacities contain the working time that is available. Moreover, formulas specify how long the capacities will be encumbered by a certain operation.

Alongside standard available capacity, intervals of available capacity and work schedules are stored. These specify exactly when a certain machine is available, for example.


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Routings (1)

Production of Pump P-100

Routing PUMPMaterial P-100 Pump

Plant 1000

Task list group 50000222

Group counter 01

Pump (standard process)

Operatn.

0010 1310

Work center Description

Staging according to pick list

Times

5 min. fixed

0020 1320 Press flywheel in casing 10 min. per 1 pc.

0030 1906 Paint casing 15 min. per 1 pc.

0040 1904 Mount shaft in casing 20 min. per 1 pc.

0050 1905 Final assembly pump 10 min. per 1 pc.

Work center 1310

Work center 1320

Work center 1906

Work center 1904

Work center 1905

Routings contain the steps that are necessary for production, that is, the corresponding operations, their sequence and the work centers in which these operations are to be executed. SAP R/3 routings can be transferred to SAP APO in the form of production process models (PPMs).

An SAP R/3 routing can be defined using the routing group and the group counter. Moreover, the routing contains reference to the material whose production it describes. A routing can contain parallel or alternative sequences in addition to the standard sequence.

Alongside the standard values, the routing also contains the time elements that are relevant for scheduling operations. Therefore you need to make sure that each operation in the routing can contain its own base quantity, to which these time elements can refer.


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Routings (2)

Fixed time elements (independent of lot size)

Operation standard values implemented in the scheduling formulas of the work center result in:

Scheduling via Routing and Work Center

Operation 30 Paint Casing

Work center 1906

Cap. 001Standard value

Setup

Machine

HR

Variable1 Sche

dul.f

orm

ula

5 min.

15 min.

1. Setup

2. Processing

3. Tear down

002

Routing PUMP

... Variable time elements

(dependent on lot size)

Schedulingbasis

A work center is assigned to an SAP R/3 operation. Using its standard value key, the work center specifies which time elements (standard values) can be taken into consideration during planning (for example, setup time, machine time, personnel time). The scheduling formulas stored in the work center define the duration from the allowed time elements in the routing.

Setup, processing and tear down of an SAP R/3 operation are each described using a corresponding formula. The steps for which a formula is stored are executed (for example, tear down may not be necessary).

If several capacities are stored in a work center, the scheduling basis is used to determine which of these capacities is relevant for scheduling.


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Routing and Bill of Material

Component Assignment in Routing

Op. 10

Routing

Op. 20

Op. 30

BOM

Mat. A

Mat. B

Mat. C

Mat. PUMP

Production version 0001

Component assignment in routing

Material master PUMP

Op. 10 Op. 20 Op. 30

Manufacturing order PUMP

Mat. A Mat. B

Mat. C

Time

Procurement and consumption of components occur at the beginning of the processes to which they are assigned

Production is described via a routing and a BOM. For this reason, BOM components can be assigned to a certain operation. The procurement of these components is then planned at the beginning of the particular operation.

Component assignment is dealt with in the routing. BOM components that are not explicitly assigned are considered as being assigned to the first operation.

In addition to BOM components, production resources/tools can also be assigned in the routing. Production resources/tools are operating facilities that are not location-bound, but that are necessary for production, such as a measuring instrument or a support.


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Master Data in Process Industries

Routing

Discrete manufacturing

BOM

Work center

Production order

Process manufacturing

Process order

Master recipe

BOM

Resource

As previously described, discrete manufacturing master data is used when the controlling of production is mapped with production orders. A production order thus uses routings, work centers and BOMs.

Other master data is required if production is to be mapped with process manufacturing (PP-PI). A master recipe instead of the routing and resources instead of work centers are used for the process order.

Discrete manufacturing master data can logically be transferred to the process industries' terminology. The master recipe is actually a special routing that was enhanced with process industry-specific functions. Moreover, in Production Planning-Process Industries (PP-PI), production versions are usually used, so that the corresponding BOMs are assigned directly to a recipe. Maintenance of the BOMs can thus take place directly from the recipe.

The resource largely corresponds to the work center. All of the previously portrayed conections thus also remain valid in PP-PI. Material Requirements

Planning for example, is completely identical for PP and PP-PI.


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SAP AG 2003

Transaction Data Objects in the Supply Chain

SNP stock transfersStock transfers

Stock transport releases

Planned ordersProduction

Production orders

Purch. requisitionsExternal procurement

Purchase orders/schedule lines

Sales orders Plnd ind. reqmts

Plnd ind. reqmts

Supply Chain Planning takes place based on master data (work centers, for example). The result of this planning is transaction data, which is used to plan procurement.

The planning process usually starts with independent requirements that are stored as planned independent requirements or sales orders. These specify demands in a distribution center or sales center, for example. However, independent requirements can also be created directly for an individual production plant.

You use the network to plan how to fulfill these independent requirements. They are fulfilled by either stock transfers, in-house production, or external procurement.

Stock transfers are modeled through SNP stock transfers, in-house production is modeled through planned orders and production orders, and external procurement is modeled through purchase requisitions and purchase orders (or scheduling agreement releases).


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SAP AG 2003

Sales Orders and Planned Independent Requirements

Sales order

Sold-to party K1000 Becker Berlin

Supplying plant 2500 DC Rotterdam

Material P-100

Customer K1000

DC 2500

Plant 1000

What product does the customer require, on what date, and what quantity?

From which plant or DC should the customer receive supplies?

10 pc 20. 12. 2002

Planned ind. reqmnts

Plant 1000 New York

What quantities of the product should be produced?

Sales

Forecast

Planning table

Material P-100 100 pcM 1.2003

110 pcM 2.2003

110 pcM 3.2003

120 pcM 4.2003 ...

Sales orders are created in Sales and Distribution (SAP R/3 SD). They portray an order made by a customer, whereby a certain quantity of a product is required by a predetermined date. Sales orders represent a requirement in the supplying plant.

Make-to-stock planning is realized in a DC or a production plant via planned independent requirements. Planned consumptions are thus forecast. Procurement takes place as a result of this planning and forecast. Ideally, if concrete requirements subsequently exist (in the form of sales orders or dependent requirements, for example), these can be met from the warehouse.


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Stock Transfers

Stock Transport Release

DC 2500

Plant 1000

Plant 2400

Coverage of Requirements via Stock Transport from Another Location

Purchase requisition

Plant (target location) 2500

Source of Supply 1000

Material P-100 10 pc 20. 12. 2002

Supplying plant

In what quantity and for what date is the material to be procured?

Where will the material be procured?

In procurement via stock transport from

own location

Material P-100 10 pc 17. 12. 2002

3 day deliverytime

When is the material procured in the source location?

Stock transports (for example, for assemblies) can also be carried out between two production plants.

Requirements can be met by stock transports from other locations in the location network. For this processing, a purchase requisition for procurement from the "supplying plant" is created in the location making the request. In return, the supplying plant receives a requirement in the form of a stock transport release.


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SAP AG 2003

Planned Orders and Production Orders

Plant 1000

Planned OrderMaterial P-100 Plant 1000Order quantity 10 pc

17.12.2002

End

10.12.2002

Start

...Production OrderMaterial P-100 Plant 1000Order quantity 10 pc

17.12.2002

End

10.12.2002

Start

AR-RES...

00200010 0030 0040

The material "Pump" is produced in plant 1000 (procurement type: in-house production)

Casing10 pc

Dep. req. Casing10 pc

Convert

Planned orders are used to plan the in-house production of a material. Planned orders already contain the basic dates within which production should take place. Moreover, they contain, in the form of dependent requirements, the component requirements for the components that are needed for production. Capacity Requirements Planning can be executed based on planned orders.

For the ultimate execution of production, the planned order is converted into a production order, that is, a production order (PP) or a process order (PP-PI).


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SAP AG 2003

Purchase Requisitions and Purchase Orders

Plant 1000

Planned order

Material 100-130 Plant 1000Order quantity 80 pc

08.12.200201.12.2002

The material "screw" is bought for plant 1000 (procurement type: external procurement)

Convert


Plant 1000Source of Supply

Material 100-130 80 pc 10. 12. 2002

Supplier

Purchase order

Plant 1000Source of Supply

Material 100-130 80 pc 10. 12. 2002

C.E.B. BerlinL1000

For externally procured materials, planning of procurement can take place by means of planned orders or purchase requisitions. If planned orders are created at first, they have to be converted into purchase requisitions. Planning is also directly possible with scheduling agreement releases.

In purchasing, purchase requisitions are converted into purchase orders. No later than this step should a source of supply (a supplier) assigned to purchase orders .


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Supply Chain Planning in the SAP System Group

R/3 APOTransaction data

APO R/3Master dataPlants, vendors, customersMaterialsWork centers (capacities)Task lists and bills of

material...

Sales ordersPlanned/production

ordersPurchase ordersStocks...

Planning ResultsProduction ordersOrder proposalsResult of availability check...

APO

BW

R/3 4.6C R/3 3.1I

For Supply Chain Planning, the SAP APO system is used in connection with the SAP R/3 system. Linkage with SAP R/3 systems (one or more) takes place via the SAP APO Core Interface (CIF). A mutual system connection has been set up in Customizing, in the form of RFC connections, which makes it possible to transfer data relevant for the planning processes from the execution SAP R/3 system into SAP APO, and also to return the planning results from SAP APO to SAP R/3.

The data transfer between SAP R/3 and SAP APO systems is defined and controlled using the SAP APO Core Interface (CIF). The CIF is the central interface used to connect SAP APO to the SAP R/3 system environment. The CIF interface is an add-on to the SAP R/3 system that you install using the relevant plug-in.


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Integration Model and SAP APO-Relevant Data

APO

SAP APO-relevant master data/transaction data is selected in the active integration models of the CIF

...

PUMPS MASTER DATA

Integration models active

Materials are SAP APO-relevant

Name PUMPS

Applic. MASTER DATA

Material master

Relevant materials

MaterialPlant 1000...

...

Integration model

Planning for these objects takes place in SAP APO

PUMPS TRANSACT. DATA

...

Material AMaterial B

Material C

Objects that should be planned in SAP APO are selected in integration models in the CIF of SAP R/3. When activating an integration model for the first time, initial data transfer occurs, that is, the selected data is transferred to SAP APO for the first time. If a model is thus active, the data that has been selected exists in SAP APO accordingly. This data is described as SAP APO-relevant.

Integration models are defined in SAP R/3. When doing so, you predetermine the object types first of all (material masters, plants, customers, production orders, for example) before you select the individual objects (for example, via the material number). Integration only becomes active once you "Activate".

Any changes you make to the master data in the SAP R/3 system that are SAP APO-relevant, must be transferred into the SAP APO system too. An incremental data transfer assumes that an active integration model is available for the relevant materials, and that the materials are SAP APO-relevant.


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SAP AG 2003

Supply Chain Master Data in SAP R/3 and SAP APO

Initial transfer

Incremental data transfer

Core Interface (CIF)

APOR/3

Work center/capacity

Routing and bill of material

Resource

Production process model

Plant

Customer

Supplier

Material master

Location (with location type)

Product master

SAP R/3 master data SAP APO master data

The SAP APO Core Interface concerns a real-time interface. Only the data objects needed in the data structures reconciled in Supply Chain Planning in SAP APO for the particular planning and optimization processes are transferred from the complex dataset in SAP R/3 to SAP APO.

Both the initial data transfer (initial transfer) and the transfer of data changes within SAP APO take place via the SAP APO Core Interface.

The master data objects in SAP APO are not identical to those in SAP R/3. During master data transfer, the relevant SAP R/3 master data is usually mapped onto corresponding SAP APO planning master data.

The SAP R/3 system is always the dominant system for master data. Only specific SAP APO master data that does not exist in SAP R/3 is created directly in SAP APO.


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SAP AG 2003

Master Data Changes

APOAPO

R/3R/3


Routing and bill of material

Resource


Plant

Customer

Supplier

Material master

Location (with location type)

Product master

Incremental datatransfer

CIF

Changes to master data

At most, only SAP APO settings are

maintained in SAP APO

The SAP R/3 system remains the dominant system for the master data. Maintenance of master data, that is, the creation of new data or changes to existing data takes place in SAP R/3. New data as well as data changes are then transferred from SAP R/3 to SAP APO via the SAP APO Core Interface.

Within the framework of a data transfer from SAP R/3 to SAP APO, the changed data records (a material master, for example) are, in principle, completely retransferred. For this reason, it does not make sense to maintain the settings in SAP APO, that can be transferred from SAP R/3.

Ideally, maintenance of master data takes place exclusively in SAP R/3. However, SAP APO master data settings, that is, settings that have no counterpart in SAP R/3 need to have their data maintained directly in SAP APO.


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SAP AG 2003

Supply Chain Transaction Data in SAP R/3 and SAP APO

APO transaction data

APOAPO

R/3R/3

Purchase orders

Purch. requisitions

Sales orders

Planned orders

Planned ind. reqmts

Reservations

Stocks...

Initial datatransfer

Real time

R/3 transaction data

Order with category

Purchase order (PchOrd)

Purch. requis. (PurRqs)

Sales order (SalesOrder)

Planned order (PlOrd)

Pld. ind. reqs. (FCreq)

Reservation (PrdRes)

Warehouse stock (Stock)...

Change transfer

The selection of transaction data to be transferred to SAP APO is specified in an integration model you define in SAP R/3. All transaction data is mapped to orders in SAP APO, which are distinguished by their ATP category. SAP APO transaction data is therefore not identical SAP R/3 transaction data. Mapping of objects on top of one another takes place via the CIF Core Interface.

An initial data transfer also occurs for transaction data. As a rule, the change transfer between SAP R/3 and SAP APO follows automatically for transaction data objects belonging to an active integration model. New transaction data or changes to existing transaction data are transferred automatically.


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Supply Chain Planning takes place in the following locations: Plant, distribution center, customer and vendor.

Supply Chain Planning takes place at material level.Material masters contain general and location-specific data.

Material flow in the Supply Chain is specified via external procurement relationships. For example, a production plant can, via stock transport, procure for a distribution center.

Production of a material in a plant is described viaBOMs and routings. Individual steps are carried out at work centers.

Master and Transaction Data: Unit Summary (1)


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SAP AG 2003

Independent requirements in the form of planned independent requirements or sales orders trigger procurement in the network.

Stock transport between locations of one's own procurement network can be planned with the help of stock transport requirements.

In-house production is planned on the basis of planned and production orders, external procurement via purchase requisitions and purchase orders.

When using SAP APO, all master data needed for planning is transferred from SAP R/3 to SAP APO via the CIF Interface: Transaction data is also exchanged via the CIF Interface.

Master and Transaction Data: Unit Summary (2)


2.32Master and Transaction Data Exercises

Unit: Master Data and Transaction DataTopic: SAP R/3 Master Data

At the end of these exercises, you will be able to:

display the SAP R/3 master data that is necessary for the production of a material in a plant.

Pumps with the material number T-F2## (## represents your group number) are produced in Plant 1000. Production Planning and Detailed Scheduling for pump T-F2## takes place in SAP APO, whereas the master data is created in SAP R/3 and transferred to SAP APO from there.

Using the master data in SAP R/3, you familiarize yourself with the production planning process of Detailed Scheduling.

1-1 Display the material master of pump T-F2## in plant 1000. In the SAP R/3 System, use the transaction to display material masters, which you call from the production master data menu, for example.

1-1-1 Once you have accessed the transaction, enter Material T-F2##, on the following screen select the views Basic Data 1, MRP 1 to MRP 4 and Work Scheduling. Finally, enter Plant 1000 as the Organizational Level.

1-1-2 Display the Basic Data 1 view. What is the exact description of the material?

___________________________________________________

What material type does the material belong to?

___________________________________________________

1-1-3 Use Enter to get to the next selected views.

Is the material produced in-house or procured externally (view MRP2)?

___________________________________________________

1-1-4 Proceed to view MRP 4 (by choosing Enter twice, for example). Has a production version been defined for the material?

___________________________________________________

Display the details for Production version 0001. What lot-size range can this production version be used for?

___________________________________________________


A routing and a BOM have been defined in the production version. What is the number of this routing?

Task list group: ___________________________

Group counter: _______

What BOM has been defined?

Use: _____________

Alternative: _____________

1-1-5 Exit the production version and display the view Work scheduling. What in-house production time has been entered here?

____________________________________________________

Roughly how long does the production of 100 pumps thus take?

____________________________________________________

Does this time include the procurement of the necessary assembly groups and components?

____________________________________________________

1-2 To find out which assemblies and components are necessary for the production of Pump T-F2##, display the BOM that is used in the production version 0001 (see above):

1-2-1 Display the material BOM for the Material T-F2##. You can find the corresponding transaction in the production master data. Call up the transaction and enter BOM usage 1 for the material, Plant 1000. You access the item overview by choosing Enter. What components are needed for the production of the pump (five materials, one document)?

____________________________________________________

____________________________________________________

____________________________________________________

1-2-2 Which ‘components’ are themselves made up of further components? (note the Assembly indicator).

____________________________________________________

1-2-3 Double click on the Assembly indicator in the BOM item to enter the BOM of the assembly. In doing so, note which components are contained in Assembly T-B1##.

____________________________________________________

____________________________________________________

1-3 Finally, display the different steps that have to be carried out to produce Pump T-F2##. To do this, refer to the routing that is contained in production version 0001 (see above):


1-3-1 Display the routing for Material T-F2##. You can find the corresponding transaction in the production master data. Call up the transaction and enter the material and Plant 1000. You access the header overview by choosing Enter. Select the first plan in the overview (that is, the plan with Group counter 1, as defined in the production version) and proceed to the Operation Overview for this plan (simply double click on the corresponding lines in the header overview.

Which operations are carried out at which work centers (note the operation descriptions)?

0010: ________________________________________________

0020: ________________________________________________

0030: ________________________________________________

0040: ________________________________________________

0050: ________________________________________________

0060: ________________________________________________

1-3-2 Now enter the component overview (using Component allocation-generic). Are components assigned to operations other than the first one?

____________________________________________________

Note: no explicit assignment means that components belong to the first operation.


Exercises


Unit: Master Data and Transaction DataTopic: SAP APO Master Data


display the SAP APO master data that is necessary for the production of a material in a location.

This exercise is optional.

Production Planning and Detailed Scheduling for pump T-F2## takes place in SAP APO, whereas the master data is created in SAP R/3 and transferred to SAP APO from there.

Familiarize yourself with the master data in SAP APO.

2-1 The production of Pump T-F2## is planned in SAP APO. The master data that is necessary for production was created in SAP R/3 and transferred from there to SAP APO. Using the product master and the production process model as an example, look at the result of the data transfer to SAP APO.

2-1-1 In SAP APO call up Produkt T-F2## in the master data. Display the data for this product in Location 1000. Look at the procurement tab page. What procurement type has been entered here?

____________________________________________________

Does the procurement type correspond to the setting in the SAP R/3 material master that you looked at in the last set of exercises?

____________________________________________________

2-1-2 Display the Production process model (PPM) in the master data in SAP APO. Select this by using Product number T-F2## and by entering Location 1000. You enter the PPM using the Display function.

The SAP APO production process model is a result of the transfer of the SAP R/3 routing and BOM. It is a comparatively complex master record. Using the flowchart, you can create an overview of the individual production steps. They correspond to the process that you became familiar with using the SAP R/3 routing.

You display the PPM using three different screen areas. You use the graphic in the bottom left area of the screen, firstly by enlarging it onto a greater area of


the screen (by moving the dividing lines) and then by using the function fit to objects. The structure of the PPM should now be clearly visible.

You can see the different operations 0010 to 0060 in the left part of the chart. By placing the mouse cursor over any of the symbols, the operation descriptions are made visible. Do the operations correspond to the operations in SAP R/3, that you noted down previously?

____________________________________________________

In the SAP APO PPM, an operation is split up into several activities. You can recognize these activities by the Flywheel symbol to the right of the operations. The operations are carried out one after the other. The process can be recognized by the red arrow between the activities.

In the chart, view the components that are assigned to operation 0010 (or to be more precise, the components that are assigned to the first activity of this operation). Do the components correspond to the components in the SAP R/3 routing, that you noted down previously?

____________________________________________________

Explain the difference.

____________________________________________________

____________________________________________________

____________________________________________________


2.33Master and Transaction Data- Solutions

Unit: Master Data and Transaction DataTopic: SAP R/3 Master Data

1-1 SAP R/3 menu path: Logistics Production Master Data Material Master Material Display Display Current

1-1-1

1-1-2 Material description: Pump PRECISION 102

Material type: FERT (finished product)

1-1-3 Produced in-house or procured externally: The material is produced in-house. (Procurement Type E).

1-1-4 Production version defined?: Yes, a production version has been defined. The version indicator has been set.

Lot-size area of production version 0001: The production version can be used for lot-sizes of 1 to 999,999 pieces.

Routing:

Task list group: varies, for example 50000492Group counter: 1

Bill of material:

Use: 1

Alternative: 1

1-1-5 In-house production time: A setup time of 0.07 days, a queue time of 0.71 days and a processing time of 15,48 days per 100 pieces has been entered.

Time taken to produce 100 pumps: The total of the above-mentioned time elements gives the time needed to produce 100 pumps, that is, roughly 16 days.

Procurement of the necessary assemblies and components included?: No, this is the time taken to produce the pumps only.

1-2 SAP R/3 menu path: Logistics Production Master Data Bills of Material Bill of Material Material BOM Display

1-2-1 Components needed to produce the pumps: Materials T-B1##, T-B22##, T-B3##, T-B4##, T-T3##, Document “Assembly drawing for pump”.

1-2-2 Components consisting of further components: The components T-B1##, T-B22##, T-B3##, T-B4## are made up of further components.


1-2-3 Components belonging to Assembly T-B1##: Materials T-T1##, T-T2##, T-T3##.

1-3 SAP R/3 menu path: Logistics Production Master Data Routings Routings Standard Routings Display

1-3-1 Operations and work centers:

0010: Material staging by picking list, T-M##

0020: Press flywheel in casing, T-V##

0030: Paint casing RAL 1015 white, T-L##

0040: Insert hollow shaft in casing, T-E##

0050: Final Assembly of pump, T-F##

0060: Deliver to stock, T-P##

1-3-2 Components assigned to operations other than the first one: No, none of the components are assigned explicitly.


Solutions


Unit: Master Data and Transaction DataTopic: SAP APO Master Data

2-1 SAP APO menu path: APO Master Data Product

2-1-1 Procurement type: Procurement type E for in-house production

Correspond to SAP R/3? Yes, the procurement type corresponds to the setting in SAP R/3.

2-1-2 SAP APO menu path: APO Master Data Production Process Model

Operations correspond to SAP R/3? Yes, the operations correspond to those in SAP R/3.

Components correspond to those in SAP R/3? In SAP APO, the component T-T3## and the document item are missing.

Explanation: Component T-T3## is not contained in any active integration model, and is thus not planned in SAP APO (but in SAP R/3 instead). As a rule, document items are not transferred to SAP APO.


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SAP AG 2003

Demand Planning in SAP R/3 (SAP R/3 SOP)

Demand Planning in SAP APO (APO DP)

Advantages of SAP APO DP

Integration between SAP R/3 and SAP APO

Demand plans and planned independent requirements

Contents:

Demand Planning

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SAP AG 2003

Describe the concept and functions of DemandPlanning

Name the most important tools in Demand Planning

Outline the differences of Demand Planning in SAP R/3 and SAP APO

Create a simple sales forecast, and release the results to Production Planning.


Demand Planning: Unit Objectives

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SAP AG 2003


Demand Planning


Course Overview


Demand Management



Conclusion

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Demand Planning Overview




APOAPO

R/3R/3


Scheduling (PP/DS)Capacity Requirements

Planning (CRP)

Demand Management

BWLISDemand Planning

(DP)Flexible Planning

Standard SOP

Demand Planning can be carried out within flexible planning in SAP R/3 or in the form of Demand Planning (DP) in SAP APO.

Demand Planning is very flexible. Different past figures, such as those that are made available in the SAP R/3 Logistic Information System (LIS) or the SAP Business Information Warehouse (BW) can be used for forecasting. There are a multitude of algorithms that you can choose from to create the forecast itself.

Demand Planning is often used to create a production program. Demand Planning results are then transferred to Demand Management as planned independent requirements. You can either continue using the result of SAP APO Demand Planning in SAP APO or transfer them to SAP R/3.

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Demand Planning Planning Levels

Distribution centers (DC)

Regions

Aug. Sept.W32 W33 W34 W35 W36 W37 W38 W39 W40 W41

Material

Material hierarchy

Buckets

Sold

-to p

arty

Demand Planning is a tool for forecasting future demands. You can create quantity-based as well as value-based plans. You can freely choose your planning levels, that is, you can plan your future demands for specific customers, regions or sales organizations. Time bucket profiles can also be freely defined for planning.

Planning levels are defined using characteristics in the system. Characteristic values are thus the objects by which you aggregate, disaggregate and evaluate business data.

Planning data is stored in the form of key figures. Key figures contain numerical values that signify either a quantity or a value; for example projected sales value in euros or projected sales quantity in pallets.

Time characteristics define the buckets in which you view, plan and store data. The multidimensional nature of the data store allows for powerful data analysis capabilities using the

selection, drill-up and drill down functions of Demand Planning.

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The Demand Planning Concept

Aggregated historicaldata


Statistical forecasting Collaborative forecasting Overrides Market intelligence

Planning levels, for example Location Product hierarchy Sold-to party Sales organization Region

Salesorders

Invoices Goodsissue

The SAP APO DP library of statistical forecasting tools and advanced macro techniques allows you to create forecasts based on sales history as well as any number of causal factors, and use a consensus-based approach to consolidate the results.

Marketing intelligence and management adjustments can be added using forecast overrides and promotions.

Aggregated actual data can be extracted from the SAP R/3 system in exactly the same way as it can be imported from SAP BW, Excel, or legacy systems.

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The Demand Planning Process

Aggregated historicaldata


Consumption possible

Update Release

Planned independent requirements

Salesorders

The slide shows the Demand Planning cycle: Past sales order quantities form a basis for the forecasting of future demands. In addition, market intelligence or one-off events (such as trade fairs) can be included in the forecast. As a result of the forecast, the demand plan is released as a planned independent requirement. Planned independent requirements form a basis for procurement and production planning and can, for example, consume the current sales orders.

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Consistent Planning

Consistent planning (top down, middle out, bottom up)

Drilldown and drill-up functions

W 24 W 24 W 24Demand PlanningTotal

P-103P-102

P-104P-105

505050200

50506050

210

50100120100420

100

Products

Sold-to party

Consistent planning means that planning data on all planning levels can be kept consistently (automatic aggregation and disaggregation). Consistent planning in the whole enterprise enables detailed plans to be automatically consolidated.

Top down planning: An aggregated plan is automatically distributed down to detailed level (products, customers, sales areas, and so on) according to proportional factors.

Middle out planning: Medium level planning data is aggregated up for the overall plan and distributed down to detailed level.

Bottom up planning: Detailed data is automatically aggregated up to the overall plan. In the lower part of the slide, you can see how you can consistently change planned data on different

levels: First of all, planned sales for pump P-102 are increased from 50 to 60 pieces. This increases the total of sales quantities for all pumps. The sales quantity for all pumps doubles and as a result, the quantities of the individual pumps also double.

This type of planning supports the simulation of multiple planning scenarios.

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Calculations in Demand Planning

GraphDesign

APO - Product Total APO - Location Total

W 24 W 25 W 26 W 28W 27ID Object Text

Selection ProfileUser

Selection ID

Planning BookData Views

Macros

P-102P-103P-104P-105

PUMP 2PUMP 3PUMP 4PUMP 5

Demand PlanningActual Demand

CorrectionForecast

Internet CorrectionDemand Plan

Capacity Leveling

Calculate totals and differences

Calculate sales budgets

Define your own alerts

Launch status queries

Send e-mails

Macros perform complex calculations quickly and accurately. The extreme flexibility of the macros allows the planner to model a planning environment based on individual business tasks.

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Forecasting Techniques


Forecast

W 24100

W 2587 120

W 26

101

W 28W 2799

103

W 29 W 30

105

Today


Forecasting Techniques

Moving average

Constant models

Trend models

Seasonal model

Exponential smoothing

You can choose any type of historical data for the forecast: Any key figures can be used. For example, you can forecast material consumptions, incoming order quantities, invoiced quantities, or sales revenues.

The system uses different forecasting models to determine the future pattern of the key figure concerned.


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SAP AG 2003

Differences Between Demand Planning in SAP R/3 and SAP APO

APOR/3

Aggregated historical data via LIS update

Planning on LIS info structures(database) with max. 9 characteristics

Simple macros Rough-cut capacity planning Integration with CO/PA Fixed drill-down Standard forecasting techniques Events

Global server with a BW infrastructure

Main memory-based planning

Integrated exception handling, definition of own alerts, complexmacros

Integration with productionplanning (SOP scenario)

Flexible navigation in the planningtable, variable drill down, graphic

Extensive forecasting technique

Promotion planning and evaluation, 'like' modeling

Collaborative planning via the Internet

Sales bills of material (BOMs)

The Business Information Warehouse (BW) infrastructure includes easy to use features for extracting all the data from execution systems and analyzing it in the SAP BW Business Explorer.

Macros can be used to perform complex calculations, and to define conditions and exception messages (alerts). E-mails can be sent automatically, and status automatically queried.

In the SOP scenario, the feasible production plan from SNP or PP/DS is compared with the original demand plan. Deviations are identified automatically and reported to the planner.

The following statistical procedures are all available for forecasting; Constant model, Trend model, Seasonal model, Trend and Seasonal model, Croston method with exponential smoothing, Linear regression, and Causal models with multiple linear regression. External forecasting procedures can also be linked to this.

"Like modeling" refers to the forecasting of new products using historical data from old products. Life cycle definition is also covered in like modeling.

You can make each planning book accessible to customers or suppliers over the internet in order to be able to exchange data as soon as possible.


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SAP AG 2003

SAP R/3 Planning Components

LIS

Quantities and dates Planned orders Purch. requisitions BOM explosion Capacity requirements

for work centers

MPS/MRP

Planned ind. reqmts

Material Plant

Demand Management

Sales organization Division Sold-to party Material Plant

Demand plans SOP

Production plans

...

APO

Sales and Operations Planning (SOP) displays the planning tool within the Logistic Information System (LIS).

SOP is a flexible forecasting and planning instrument with which sales, production and further target figures within the Supply Chain can be determined. Historical, current and/or estimated data for the future creates a basis for this. Planning with SOP is generally medium to longterm. Furthermore, resource planning is also possible. This is used to detemine work center capacities and other necessary resources needed to realize pre-defined goals. SOP supports the planning of complex planning hierarchies on a higher level as well as the detailed planning of finished products. SOP enables you to plan "from top to bottom" (top down) or "from bottom to top" (bottom up).

The architecture of the supply chain planning systems is based on the MRP II concept


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SAP AG 2003

Integration Between SAP APO and SAP BW

Sales history,price, costs, ...

Forecast

BusinessInformationWarehouse

Forecast Reporting

Forecast & planning scenarios Causal factors Lifecycle patterns Seasonal patterns Promotional patterns

Summarized data Order and shipment data Cost information ...

Demand Planning

APO

Demand Planning Specific Data Central Data Pool

BW

A distinction is made between the Business Information Warehouse (BW) contained in SAP APO and the separate mySAP component mySAP BW. As a rule, SAP APO Demand Planning is carried out based on data from the internal BW.

If you carry out extensive reporting, it is recommended that you implement a separate BW server and only transfer data to SAP APO, that is relevant to planning.

As the data structures in BW and SAP APO are technically identical, you can use the BW Explorer to evaluate SAP APO data.


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SAP AG 2003

Interactive SAP APO Demand Planning

GraphDesign

APO - Product Total APO - Location Total

W 24 W 25 W 26 W 28W 27ID Object Text

Selection ProfileUser

Selection ID

Planning BookData Views

Macros

P-102P-103P-104P-105

PUMP 2PUMP 3PUMP 4PUMP 5


CorrectionForecast

Internet CorrectionDemand plan

Capacity Leveling

Selector

Selected objects

Standard selections

Right mousebutton:

Additional settings

Header information

The SAP APO module Demand Planning (SAP APO DP) and Supply Network Planning (SAP APO SNP) use a uniform tool for planning. It consists of two components: The selection area and the work area.

The selection area is the window, in which you choose the InfoObjects you want to plan. In the selection area you can save frequently used selections and load existing selections. To open the selection area, choose the selection window icon.

The selection profile displays all the selection IDs which have been assigned to the planner. The planner can access commonly used selections quickly using the selection IDs.

You choose the work area using your planning books and views. You can define a filter for available planning books and views.


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SAP AG 2003

Further SAP APO Forecasting Techniques

Univariate Forecasting Moving average

Constant-, trend- and seasonmodels (Holt-Winters, for example)

Exponential smoothing

Seasonal linear regression Croston's method (for sporadic

demand)

Causal Analysis Multiple linear regression

Composite Forecasting Weighted average of multiple

models

A company's product spectrum covers a variety of products in different stages of their lifecycle and with different demand types.

APO Demand Planning offers a "toolbox" of proven forecasting methods. The system allows you to choose the best method for a specific demand type.

Composite forecasting extends the idea of pick-the-best; with this technique you combine two or more methods.

Croston's method allows you to model sporadic demand. The statistical forecasting toolbox provides all the features you require to efficiently create accurate

forecasts, including everything from data analysis via time series models through multiple linear regression.


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SAP AG 2003

SAP APO Lifecycle Management

Like

Actual Data of the Old Product

Time

Forecasting of the New Product

TimeLifecycle

Sales

You use lifecycle planning and "Like" modeling to forecast the launch (phase-in) and discontinuation (phase-out) of a product.

A product's lifecycle consists of different phases: Launch, growth, maturity, and discontinuation. This process models launch, growth, and discontinuation phases.

For all characteristic value combinations, you can use either a "like" profile, a phase-in profile, or a phase-out profile, or any combination of these.

If the phase-out profile period is within the history horizon of the master forecast profile, the system adjusts history input values, displays the adjusted values in the key figures original history and the corrected history, and writes the adjusted values to the corrected history.

If the phase-in profile period is within the future horizon of the specified master forecast profile, the system adjusts baseline or original forecasts, and writes the adjusted values to the corrected forecast key figure.


3.17

SAP AG 2003

Release of Sales Quantities as Planned Independent Requirements

APO APO

Production PlanningDemand Planning

Key figure: Sales quantity Planned ind.reqmnts

SNPPP/DS

Production quantitiesKey figure: Feasiblesales quantity

MacrosAlerts

Once the various stakeholders in the forecast have reached a one-number, consensus plan, you release the demand plan as a planned independent requirement.

You release the demand plan from Demand Planning (DP) via either the demand planner or the SNP planner.

This process creates order objects or time series objects. These anonymous demands form the basis of SNP, or PP/DS, where BOM explosion, capacity planning, and sourcing are carried out for the complete supply network.

After feasibility of the planned sales quantities in SNP or PP/DS has been checked, the results can be transferred back to Demand Planning. Macros are used to analyze the differences between the demand plan and feasible quantities and alerts are generated if large differences occur.


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SAP AG 2003

You use Demand Planning to derive future sales quantities from historical data.

Demand Planning is carried out interactively from the planning table. Mass processing is used for forecasting and releasing planned independent requirements.

Demand Planning in APO DP can be structured more easily than is possible within SAP R/3 SOP, as it is based on the data structures of SAP BW.

Demand Planning: Unit Summary


3.19Demand Planning Exercises

Unit: Demand PlanningTopic: Interactive Planning


Create a sales forecast including corrections

Release the demand plan to Production Planning

Pumps with the material number T-F2## (## represents your group number) are planned in SAP APO. In the first step of planning, a demand plan is created in SAP APO Demand Planning. Using this plan, planned independent requirements should be made available for Supply Network Planning (SAP APO SNP). This plan is created using a statistic forecast based on historical data. Moreover, regional sales and distribution information should be taken into account.

1-1 Carry out interactive SAP APO Demand Planning for product T-F2##. To do this, use consumption values from the past to create a future production plan. Planning for the product takes place without reference to a location (production plant or distribution center). You can observe how the forecast requirements for this product are distributed over different locations in a second step.

1-1-1 From the SAP APO Demand Planning menu, call up the transaction Interactive Demand Planning. You access the table of the planning book SALES and data view, which is assigned to your user.

To edit the planning situation for product T-F2##, choose Selection Window in the top left screen area. First of all, select “APO Product” (in the “Show” field). Version 000 is already displayed automatically. In the next row, enter APO -Product once again, and on the right-hand side enter your product T-F2##. Adopt the selection.

Finally, load the data for your selection (that is, product T-F2##) in the planning table, by double-clicking on the selection line.

The available planning data is displayed on the right-hand side of the screen. You can see the sales figures from the previous year.

1-1-2 Procurement for pump T-F2## should be planned based on these past figures. Carry out a forecast.

Select Stat to carry out a univariate forecast. On the next screen you can see the forecast figures for the future, derived from historical values.


1-1-3 Analyze the result graphically by selecting Show/hide table: The results are then displayed graphically. The seasonal pattern that occurred in the past has been extrapolated into the future. Go back to the planning table.

1-1-4 Adjust the forecast by entering Adjustment of 100 pieces for the current month + 3. If you click on enter, the new forecast figure is determined.

1-1-5 Have a look at how your forecast for product T-F2## is distributed to the different locations (1000, 2400 and 2500). Use the function Header on/off and set the header information accordingly.

In Header information settings choose the characteristic APO location and adopt the setting. Select the Final forecast key figure selection using the “magnifying glass” icon.

You can now influence the display of data in the header: Exit the total display and enter the Details (all) display. You can now see from the table, how the planned data is distributed to individual locations.

As an example, note the planning figures for the next three months in distribution center 2400:

Current month + 1: ________________________

Current month +2: ________________________

Current month +3: ________________________

1-1-6 Finally save your demand planning.

1-2 Having created a demand plan for pump T-F2##, release the planning figures to production planning, that is, create corresponding planned independent requirements.

1-2-1 From the demand planning menu, call up the transaction Release to Supply Network Planning. To simplify your entry use the variant RELEASE, using the suggestions it makes to check or change information in the following places:

Planning area: SALES

Planning version (Source): 000

Key figure: FINFOR

Planning version (Target): 000

Category Leave blank (no entry)

Horizon from today to today + 3 months

Daily period split Delete (leave blank)

Product: T-F2##

Be sure the Log is checked in the lower left corner.

Do not specify a location! Which locations have had planned independent requirements created for them?

________________________________________________


Execute the release.

Despite the fact that the release transaction is described as “Release to Supply Network Planning”, the effect of planned independent requirements is not restricted to planning in SAP APO SNP. They are equally relevant for production planning/detailed scheduling in SAP APO PP/DS.

1-2-2 Look at the results of the release using distribution center 2400 as an example: From the production planning menu, call up Product view. In the initial screen, enter the following data:

Planning version 000

Product: T-F2##

Location: 2400

and confirm using Enter.

Are planned independent requirements displayed? __________________

You will have noticed that the planned independent requirements have been transferred as weekly amounts. This is because, in interactive transfers, data is transferred with the smallest time bucket profile from the planning area (if no daily buckets profile is defined); In this case, the smallest time buckets profile is weeks.

Compare the quantities with the values that you noted above. Do the quantities match?

_________________________________________________


3.20Demand Planning Solutions

Unit: Demand PlanningTopic: Interactive Planning

1-1 SAP APO Menu path: Demand Planning Planning Interactive Demand Planning1-1-1

1-1-2

1-1-3

1-1-4

1-1-5 Planning figures for the next three months in distribution center 2400:

Current month + 1: Varies, for example 36 pc.



1-2 SAP APO menu path: Demand Planning Planning Release to Supply Network Planning1-2-1 Planned independent requirements for locations: Planned independent requirements

are created for locations 1000, 2400 and 2500.

1-2-2 Menu path: APO Production Planning Interactive Production Planning Product View

Planned independent requirements displayed? Yes, planned independent requirements are displayed.

Matching quantities? Yes, the quantities match if you add up the individual week quantities to get month quantities. As the transfer period was restricted to three months, only a part quantity is displayed for the last month, if necessary.


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SAP AG 2002

Planned independent requirements

Make-to-stock production and make-to-order production

Requirements strategies

Consumption

Subassembly planning

ATP check

Contents:

Demand Management

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SAP AG 2002

Explain the function of planned independent requirements

Describe make-to-stock production and make-to-order production procedures

Explain the role of requirements strategies

Understand consumption between customer requirements and planned independent requirements

Explain the basic functions of the ATP check.


Demand Management: Unit Obejectives

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4.3

SAP AG 2002


Demand Planning


Course Overview


Demand Management



Conclusion

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4.4

SAP AG 2002

Demand Management Overview




APOAPO

R/3R/3

Sales

Global Available-to-Promise (ATP)


Scheduling (PP/DS)Capacity

Requirements Planning (CRP)

CIF


Demand Management

Flexible Planning

Demand programs for finished products are determined by independent requirements, that is, planned independent requirements and customer independent requirements. Planned independent requirements are managed in demand management.

Planned independent requirements, that is, make-to-stock planned independent requirements, are usually based on forecasts of demands to be expected in the future. These demand forecasts can take place in Demand Planning, in SAP APO Demand Planning, for example. The corresponding key figure can then either be transferred to SAP R/3 as planned independent requirements or used directly in SAP APO SNP or SAP APO PP/DS.

Planned independent requirements that are created in SAP R/3 can be transferred to SAP APO via the CIF. In principle, sales orders are entered in SAP R/3 (it is even possible to enter them in CRM) and, if necessary, transferred to SAP APO from there.

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4.5

SAP AG 2002

Demand Programs in the Production Plant

Salesorders



Material Requirements PlanningCoverage of requirements through

In-house productionExternal

procurement

Forecast Plnd. indep.reqmts

Sales

Demand program

Stock Transfer Requirements

Demand Management pertains to the administration of independent requirements. Independent requirements can be entered directly for a production plant. They can also be derived from demand planning.

Planned independent requirements are warehouse requirements that can be derived from a forecast of the future requirement situation. In make-to-stock production, you want to initiate the procurement of the materials concerned, without having to wait for concrete sales orders. Sales orders (customer independent requirements) are created by sales and distribution. Sales orders can enter the demand program directly. This is desired when customer-specific planning takes place.

Stock transfer requirements, that is, requirements from other locations of the Supply Chain (distribution centers, for example) can, in addition to the independent requirements that have been entered in the production plant, also enter the demand program.

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SAP AG 2002

Planning Strategies

Make-to-stock production(Production due to make-to-stock planning, requirements covered by warehouse stock)

Subassembly planning

(Finished products to individual customer stock using make-to-order production, and where necessary, assemblies to stock using make-to-stock)

Make-to-stock production for assemblies)

Make-to-Order production

A multitude of possibilities are available for planning for production with the help of planned independent requirements. The different mode of action of planned independent requirements is controlled by the so-called planning strategy.

If strategies are used for make-to-stock production, production usually takes place, without sales orders already having to be present for the material concerned. If sales orders are then received, these can be met by warehouse stock, so that shorter delivery times can be realized. Moreover, in make-to-stock production, it is possible to realize as consistent a production process as possible, independent of current demand.

Make-to-stock production can also be executed for assemblies. In this case, the finished products themselves are not produced to stock; rather the necessary assemblies are procured. A sales order for a finished product can then usually be fulfilled quickly, as it is only final assembly that has to be executed since the assemblies already exist.

Sales-order based production does not deal with planning in its actual sense; rather a product is procured for an existing sales order. Make-to-order production is often used in connection with subassembly planning for components, to keep delivery times as short as possible.

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Make-to-Stock Production

Planning takes place by means of planned independent requirements

Sales orders are covered by make-to-stock inventory.

Requirements strategy for make-to-stockproduction

* = additional indicator "Subassembly planning" set

APOR/3

Make-to-stock production

Planning with final assembly

Planning at assembly level

10 10

40

70

20

20*

Using make-to-stock production strategies, production or procurement is planned; using planned independent requirements that arise from the forecast of sales expected in the future. According to the choice of strategy, sales orders can affect requirements, consume planned independent requirements, or have no effect on planned independent requirements. In make-to-stock production, sales orders are usually fulfilled by warehouse stock.

The number used to indicate strategies in SAP R/3 and SAP APO is usually different, because an SAP APO strategy can contain more than one SAP R/3 strategy.

Make-to-stock production strategies are used, for example, in situations where demand and sales fluctuate but where production may be kept at full capacity. Fluctuations in demand and sales are smoothed by warehouse stock.

Planning can also take place at assembly level. This makes sense, for example, when an assembly, that is to be used in different finished products, has to be procured before the demands (sales orders) for these finished products exist.

Planning at assembly level is realized in SAP APO, by using the strategy planning with final assembly and setting the subassembly planning indicator additionally in the SAP APO product master (corresponds to strategy 70 using the mixed MRP indicator 1 in SAP R/3)

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SAP AG 2002

The Make-to-Stock Production Process

Demand program

Warehouse stock Finished product

Sales ordersfrom warehouse


Reduction

Create planned independent requirements for the finished product

Procurement through production or external procurement

Coverage of requirements from the warehouse

1

2

3

Requirements strategy 10

In make-to-stock production, customer requirements are not included in the demand program. The procurement quantities are planned exclusively as planned independent requirements (usually before the sales orders arrive). Sales orders are not MRP-relevant, but are displayed for information purposes (the sales orders are not pegging-relevant).

Production takes place in warehouse stock. Sales orders (and other requirements for the product) are covered from the warehouse. An availability check can be performed in the plant. Goods withdrawals for a sales order reduce this sales order.

Reduction of planned independent requirements takes place at goods issue for the delivery. The oldest planned independent requirement is reduced first (FIFO rule). If no more planned independent requirements exist in the past, planned independent requirements in the future can also be reduced, provided a planned independent requirement reduction in the future is permitted by a corresponding consumption interval (forwards).

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4.9

SAP AG 2002

Planning with Final Assembly

Sales OrderPlanning

Finished Product

Consumption

Prod

uctio

n

1. Planning at finished product level using plnd. ind. reqs.

2. Consumption of planning by sales orders

Strat. 40R/3 APO

Strat. 20

In planning with final assembly (SAP R/3 strategy 40, SAP APO strategy 20), a flexible or fast reaction to customer demand is prominent, whereby as smooth as possible a production process is also simultaneously strived for. Sales orders affect requirements and consume planned independent requirements.

The procurement and production of all components and assemblies including their final assembly is triggered by planned independent requirements before sales orders arrive.

You plan the planned independent requirements for the finished product in demand management. Incoming sales orders consume these planned independent requirements.

If customer requirements exceed planned independent requirements, the system automatically creates a planned order for the unplanned quantity in the next MRP run. (Sales orders thus affect requirements).

You can check availability from a sales order using the ATP logic. The consumption of planned independent requirements by customer requirements depends on the

settings defined for the consumption mode and the consumption periods.

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SAP AG 2002

Consumption

Example: Within the given period of time, 60 pieces are produced for the sales order and 20 pieces are produced (anonymously) to stock.

Planned ind. reqmts.

Customer Reqs.

Time

Backward consumption only

Bwd per.Backward consumption per.

2020

Mode 1 60

40

Time

Forward consumption only

Fwd per.Forward consumption period

Mode 3

Time

Backward/forward consumption

Fwd per.Bwd per.

Mode 2/4

1 2

The consumption mode determines the direction on the time axis in which the arriving sales orders are to consume the planned independent requirements.

In backward consumption (consumption mode 1), the sales order consumes planned independent requirements that lie before the customer requirement.

In forward consumption (consumption mode 3), the sales order consumes planned independent requirements that lie after the customer requirement.

You can combine backward and forward consumption provided that you take the consumption periods into account (consumption mode 2 or 4).

You can define the consumption mode and the consumption periods either in the material master or for each MRP group. If no values for either consumption mode or consumption period have been entered, then the system uses the default setting with backward consumption for 999 days (Note: If a consumption mode has been entered and the consumption period is left blank, only requirements on the same day are consumed).


4.11

SAP AG 2002

Planning at Assembly Level

Sales order

1. Planning at assembly level using plnd. indep. reqs.

2. Consumption by the dependent reqmts of the finished product

Strat. 70R/3 APO

Strat. 20+ Subassembly

Planning Indicator

Finished product

Prod

uctio

n

ConsumptionDep.Req.PlanningAssembly 01 Assembly 02

Planning at assembly level (SAP R/3 strategy 70, SAP APO strategy 20 + subassembly planning indicator) can be used when an assured demand forecast can be given for certain assembly groups sooner than for the individual finished products, in which the assembly group is needed.

In this planning strategy, the planned independent requirements for an assembly are planned separately. They are created at assembly level and they trigger the production of the assembly.

If sales orders for the finished products arrive, planned orders (or production orders) are created for the finished product and the BOM is exploded, that is, dependent requirements (or reservations) are created for the assembly. These consume the planned independent requirements of the assembly.

If large sales order quantities at finished product level cause the dependent requirements or reservations to exceed the planning requirements of the assembly, an additional planned order is created for the assembly in the next planning run. Secondary requirements thus fully affect requirements.

SAP R/3 strategy 70 must be entered in the strategy group of the material master and the mixed-MRP indicator for subassembly planning must be set. (In SAP APO this corresponds to strategy 20 in connection with the subassembly planning indicator).


4.12

SAP AG 2002

Consumption in Subassembly Planning

Time

Demand

Planning

Assembly planning quantities

Assembly planning quantities

Dependent requirement or order reservation

Backward Forward

Consumption Period

The consumption logic is defined by the consumption mode and the consumption periods backward and forward as in strategy 40. These are defined in the material master of the assembly or via the MRP group.

Using this strategy, the consumption periods are calculated starting from the dependent requirements or the reservations.


4.13

SAP AG 2002

Production Based on Sales Orders

Sales orders are planned on a customer-specific basis

Planning is possible

Requirements strategies for production based on sales orders

APOR/3

Make-to-order production

Planning without final assembly

Planning with planning material

20 ‚_‘

50

60

30

40

When working with the strategies for make-to-order production, the sales order is the pegged requirement.

In addition to classic make-to-order production, planning without final assembly is also possible. Moreover, different strategies for assembly processing exist in SAP R/3.

To set the make-to-order production strategy (SAP R/3 strategy 20), it is not necessary to make an entry in the proposed strategy of the SAP APO product master. In contrast to SAP R/3, SAP APO proposed strategies pertain to planned independent requirements only. Sales orders cannot be entered in SAP APO; they bring their settings with them from SAP R/3.


4.14

SAP AG 2002

Make-to-Order Production

Sales order 2Material A

Production

Customer stock Finished product

Production

Customer stockFinished product


Deliv

ery

Deliv

ery

Sales order 1Material A

Strat. 20R/3 APO

Strat. ‚_‘

For make-to-order production (SAP R/3 strategy 20), each sales order is planned separately and managed in its own section in the MRP list or the current stock/requirements list.

The system does not perform a net requirements calculation between individual sales orders or with the anonymous warehouse stock.

In make-to-order production, the lot-for-lot order quantity is used as the default setting for the lot-sizing procedure, regardless of the entry you have made in the material master record. Depending on the setting of the lot-size indicator in the material master record, you can define a different lot size for make-to-order production from the one used in make-to-stock production.

Using the "individual/collective" indicator, you can allow make-to-order production at any level of the BOM structure.

You cannot switch the produced quantities from one sales order to another -the produced quantities are managed directly for each individual sales order (in the individual customer stock).

A goods issue to the sales order reduces the individual customer stock and the requirement. As soon as the sales order is completed and the individual customer stock depleted, the individual customer segment disappears from the current stock/requirements list or the MRP list.


4.15

SAP AG 2002

Individual / Collective Indicator

To be set in the material master (can be overruled in the BOM)

MRP List: ShaftDate MRP element Quantities Avail.

Today Stock 0

Today Order A 0

Date Planned order 125 10 10

Date Dep. reqmts pump 10- 0

Today Order B 0


Date Dep. Reqmts Pump 12- 0

MRP List: Spiral casingDate MRP element Quantities Avail.

Today Stock 5

Date Planned order 127 22



17

Pump

Spiral casingShaft

MRP List: PumpDate MRP Element Quantities Avail.

Today Stock 0

Today Order A 0


Date Order A 10- 0

Today Order B 0


Date Order B 12- 0

Sales order AQty 10

Sales order BQty 12

Indiv./collect.ind. = 1

Indiv./collect.ind. = 2

The individual/collective indicator in the material master record determines whether a component is procured for a special customer requirement in the individual segment.

The indicator "1" for individual requirements means that the material is being specially manufactured or procured for a sales order. A special individual segment is created for each requirement. An individual requirement is only created if the higher-level material does not create a collective requirement.

The indicator "2" for collective requirements means that the material is produced or procured for various requirements. You can find these requirements in the net requirements segment.

The indicator "blank" means that the component is to be planned in the same way as the higher-level assembly.

In the above example, two individual segments are created for the shaft for sales orders A and B.

If you want to control the material item individually for the respective BOM, use the "explosion control" field in the component's item data (general data view). The setting in the BOM overrules the setting in the material master record.


4.16

SAP AG 2002

Availability Check

Global Available-to-Promise

Cross-location and rules-based availability check possible

Check for sales orders Product check and forecast check possible

Production start possible even when there is no availability

ATP (Available-To-Promise) Check per location (Plant)

Check against consumption with planning only

R/3

APO

Check against planned independent requirements only

The ATP check has a large number of applications. Amongst others, it can be used in sales orders, production orders or during goods movements. Therefore, when you create a sales order, the system checks, within the framework of the ATP check, whether there is enough stock available in the warehouse for the required material. The system can also check if receipts (for example, production orders and planned orders) have already been planned by the requested date. If the reply is positive, the sales order can be confirmed.

In SAP R/3 you have the option of performing availability checks according to ATP or against planned independent requirements.

For sales orders, you can carry out the ATP check in SAP APO within the framework of Global Available-to-Promise. For the materials concerned, you specify in the integration model that the ATP check should be executed in the sales order in SAP APO. The possibilities of the Global Available-to-Promise go beyond those of the SAP R/3 ATP check.


4.17

SAP AG 2002

Availability Check Using ATP Logic

Production and planned orders

Sales orders

Confirmed quantities ATP quantities

( + )

( - )

Stock

When performing an availability check using ATP logic (Available-to-Promise), the system checks whether all requirements are covered by existing receipts and whether the receipts' quantity proportions are still available to cover newly received requirements. These open quantities, which have not yet been assigned, are added together to give the ATP quantity.

In the availability check using ATP logic, the system checks whether the requirement quantities are covered by specially defined receipt and goods elements or by a specific stock. If you can confirm a quantity for the requirement date, this quantity is flagged as confirmed in the requirement and the ATP quantity of the material is reduced accordingly. In the next availability check, you can only confirm requirements for the amount of the remaining ATP quantity.

During a component availability check in a planned order or a production order, the system copies the result of the component check to the order header as the confirmed quantity and the order confirmation date.


4.18

SAP AG 2003

ATP Check for Sales Orders in SAP APO

Possible reaction if a product is not available

ATP Requests from Sales Orders

APOR/3Confirmation

Sales order

Sales (SD)

Sales order

Planned orderPlanned order

ATP request

Save sales orderATP check

Production Planning/Detailed Scheduling (PP/DS)

Optional if a product is not available Produce

In the SAP R/3 APO interface, you can specify in the integration model that the availability check (ATP check) in the sales order is not to be performed in SAP R/3, but rather in SAP APO. If you create a sales order in the SAP R/3 System, an ATP request will be sent to SAP APO. The system firstly checks whether there is enough stock available for this product and whether receipts (for example, production orders, planned orders) have already been planned by the requested date.

For non-availability, you can set the ATP check so that the system performs an availability check for the product in a different location or for an alternative product. Moreover, for non-availability of the product, you can specify that the sales order directly triggers production: In this case, SAP APO creates a planned order for the desired quantity in PP/DS. The system can then take capacity constraints (available capacity and even receipts that have already been planned) into consideration. In addition, component availability can be checked. If there are no longer any capacities available for the desired date, the system searches for a new date for the planned order to be created. The availability date of the newly created planned order (finish date) is passed back to the SAP R/3 sales order and copied as the internal confirmation date.


4.19

SAP AG 2002

Availability Check w. Plnd Ind. Reqmt Allocation

Plnd. indep. reqs

Sales order

Allocation

Check takes place against planned independent requirements only.Warehouse stock and fixed receipts are not taken into account.

(FCreq)

fully confirmed

partly confirmed

10.5.

20.5.SalesOrder

SalesOrder

Time

Time

Time

(FCreq)

SalesOrder

SalesOrder

(FCreq)

01.05. 01.06.

10.05. 20.05.

Rest cannot bedelivered until

01.06.

In the check against planned independent requirements, the system only checks against the planned independent requirements quantities, that is, no ATP quantities are included in the availability check.

In this check, the system uses the consumption mode (in the above example, a backward consumption) and the corresponding consumption periods.

Generally, you can define the type of availability check to be carried out by the requirements class in the strategy. In the SAP R/3 strategy 50 (planning without final assembly) you can only carry out the availability check against planned independent requirements, for technical reasons. In the SAP R/3 strategy 60 (planning with planning material), you can check against the planned independent requirements of the planning material, when processing the sales order.


4.20

SAP AG 2002

Planning takes place using planned independent requirements

A demand program consists of planned independent requirements, sales orders and, if necessary, stock transfer requirements.

In make-to-stock production, production is triggered and warehouse stock is created, based on planned independent requirements. Demands are met by warehouse stock.

In sales order-based production, a material is produced for a specific sales order. Subassembly planning can take place irrespectively.

Demand Management:Unit Summary (1)


4.21

SAP AG 2002

The ATP check plays an important role in sales order processing or in the execution of manufacturing orders.

An ATP check for sales orders can be executed in SAP R/3 and in SAP APO.

Demand Management: Unit Summary (2)


4.22Demand Management Exercises

Unit: Demand ManagementTopic: Planning with Final Assembly


Create planned independent requirements

Understand the consumption of planned independent requirements and sales orders.

Pumps with the material number R-F1## (## represents your group number) are produced in plant 1000. Demand management and material requirements planning for these pumps takes place in SAP R/3.

Planned independent requirements should be consumed by sales orders so that the pumps can be planned using planning with final assembly.

1-1 For pump R-F1##, it is important that incoming sales orders are supplied quickly. Production of the pumps takes a certain amount of time and thus needs to be planned in advance, that is, procurement of the pumps should take place before concrete sales orders arrive. Production of pumps in plant 1000 should be planned using planning with final assembly. First of all, change the material master of pump R-F1## in plant 1000 in the following way (to change the material master, call it up from the production master data in SAP R/3):

1-1-1 Once you have accessed the transaction, enter Material R-F1##, on the following screen select the views MRP 1 and MRP 3 and enter Plant 1000 as the organizational level.

1-1-2 Have a look at view MRP 1. Make sure that the MRP type MRP and the lot-size EX are set. What are the consequences of these settings?

___________________________________________________

What MRP controller is responsible for the planning of this material?

___________________________________________________

1-1-3 By choosing Enter, you access the next marked view, that is, view MRP 3. Make sure that the following settings have been made: Strategy group 40, consumption mode 2 and a time period of 30 days as consumption periods backwards and forwards. Between which of the requirement elements that you have set here, does consumption take place?

___________________________________________________


1-1-4 Exit the material master, using Save.

1-2 Create planned independent requirements for material R-F1##.

1-2-1 For the coming months, sales and distribution expects sales figures of the following amounts:

Current month + 2 70 pc

Current month + 3 80 pc.




Create corresponding planned independent requirements. To do this, use the transaction Create planned independent requirement, which you can call up from the program planning menu. In the initial screen of the transaction, enter material R-F1##, plant 1000 and version 00. Use months as the planning period. By pressing Enter, you reach the planning table, in which you need to enter the requirements quantities given above. Save the requirements.

1-2-2 In the current stock/requirements list that you call up from the material requirements planning menu, look at the requirements that you have just created. In the initial screen enter your material number and the plant and then call the list up by pressing Enter.

Are the requirements displayed? ______________________

Are the requirements covered by procurement elements? Why (not)?

____________________________________________________

____________________________________________________

1-3 To cover the requirements you have just created with procurement elements, and to achieve a balanced requirements/stock situation, you need to carry out multi-level material requirements planning.

1-3-1 Call up single item, multi-level in the material requirements planning menu. In the initial screen enter material number R-F1## and plant 1000. Start the planning run by choosing Enter twice. The statistics are displayed at the end of the planning run

How many materials were planned in the planning run (only one or more than one)? Why?

____________________________________________________

____________________________________________________

1-3-2 Take another look at the current stock/requirements list (if the list is in another mode, refresh it). Were procurement elements created? If yes, which ones?

____________________________________________________


What is the available quantity at the end of the list?

____________________________________________________

Is a balanced stock/requirements situation available for material R-F1##?

____________________________________________________

1-3-3 Material requirements planning results in planned orders. Would procurement of pumps be initiated based on these planned orders, even without the existence of concrete sales orders? Why (not)?

____________________________________________________

____________________________________________________

1-4 A customer orders 30 pumps for the current month + 3. To simplify matters, this sales order should be created in the form of a corresponding customer requirement (we are only interested in the impact of a sales order in MRP):

1-4-1 From the demand management menu, call up the transaction Create customer requirement. In the initial screen, enter delivering plant 1000 and then confirm this using Enter. In the following entry screen, enter the Req. deliv. date as the fifteenth day of the current month + 3. Reconfirm using Enter and create a customer requirements item containing the following data:

Material: R-F1##

Order quantity: 30 pc.

Confirm your entries using Enter.

The procurement type KSV (sales order with consumption) is determined using the strategy group entered in the material master.

Save the customer requirement.

1-4-2 Look at the current stock/requirements list (if the list is in another session, refresh it). Is the customer requirement that you just created displayed?

____________________________________________________

1-4-3 Does the customer requirement have an influence on the MRP-available quantity (does the MRP-available quantity change to the date of the customer requirement)?

____________________________________________________

What is the available quantity at the end of the list?

____________________________________________________

1-4-4 You have just realized that the available quantity at the end of the list is still zero. The customer requirement is relevant for requirements and has been added


to the planned independent requirements. How do you explain that all requirements can still be covered in total?

____________________________________________________

____________________________________________________

1-5 Consumption has obviously occurred between the planned independent requirements and the customer requirement. Analyze the consumption situation using the current stock/requirements list:

1-5-1 From the current stock/requirements list of material R-F1## (plant 1000), execute the function Environment Total reqmts display. The stock situation, including consumption is displayed. Which planned independent requirement (which month quantity; note the date and quantity) does the sales order consume?

____________________________________________________

1-5-2 Return to the list and look at the month quantity (that is displayed for the first workday of the month). What quantity is displayed?

____________________________________________________

Give a reason for the result:

____________________________________________________

____________________________________________________

Consumption of planned independent requirements by the customer requirement causes changes to the requirements situation to occur (the dates of the requirements are rescheduled by the concrete customer requirements). A new planning run would react to this new requirements situation by creating new procurement suggestions. This step has not yet been executed.


4.23Demand Management Solutions

Unit: Demand ManagementTopic: Planning with Final Assembly

1-1 SAP R/3 menu path: Logistics Production Master Data Bills of Material Bill of Material Material BOM Display

1-1-1

1-1-2 Consequence of settings: If you set MRP type PD, the material requirements planning is set. Using the lot-size EX, shortage quantities are satisfied exactly.

MRP controller: MRP controller 0## is responsible for planning.

1-1-3 Requirement elements with consumption: Customer requirements consume planned independent requirements.

1-2

1-2-1 SAP R/3 menu path: Logistics Production Production Planning Demand Management Planned Independent Requirements Create

1-2-2 Menu path: R/3 Logistics Production MRP Evaluations Stock/requirements list

Are the requirements displayed? Yes, the requirements are displayed.

Requirements covered by procurement elements? No, the requirements are not covered by the corresponding procurement elements, as an MRP run has not yet been carried out.

1-3

1-3-1 SAP R/3 menu path: Logistics Production MRP Planning Single-Item, Multi-Level

Materials in the planning run: 10 materials were planned. In multi-level planning, in addition to the header material, all materials (planned using MRP) in the BOM structure are planned.

1-3-2 SAP R/3 menu path: Logistics Production MRP Evaluations Stock/requirements list

Procurement elements created? Yes, planned orders were created to cover the requirements.

Available quantity at the end of the list: The available quantity at the end of the list is zero pieces.


Balanced stock/requirements situation? Yes, the stock/requirements situation has thus been balanced out: The amount of procurement elements equals the amount of requirements.

1-3-3 Procurement of pumps already initiated? Yes, the procurement of the pumps would be initiated, as planned orders can be converted into production orders. The aim of planning with final assembly is to initiate procurement before concrete sales orders arrive.

1-4

1-4-1 SAP R/3 menu path: Logistics Production Production Planning Demand Management Customer Requirements Create

1-4-2 SAP R/3 menu path: R/3 Logistics Production MRP Evaluations Stock/requirements list

Customer requirements displayed? Yes, the customer requirement is displayed with dates and quantities.

1-4-3 Influence on MRP-available quantity? Yes, customer requirements have an effect on MRP.

Available quantity at the end of the list: The available quantity at the end of the list is zero pieces.

1-4-4 Explanation: The planned independent requirements have been consumed by the customer requirement.

1-5 SAP R/3 menu path: Logistics Production MRP Evaluations Stock/requirements list

1-5-1 Month quantity with consumption: Consumption (assignment) takes place with the month quantity of the current month + 3, the requirements quantity amounts to 80 pieces.

1-5-2 Displayed quantity in the list? In the current stock/requirements list, a planned independent requirements quantity of 50 pieces is displayed for the first workday of the current month + 3.

Explanation: Only the non-consumed amount of the planned independent requirement is displayed, as only this percentage is relevant to MRP. The consumed amount is adopted by the customer requirement.


5

SAP AG 2002


Integration between SAP R/3 and SAP APO

Purposes and environment

Master data

Heuristic

Capable-to-Match and optimization as further planning methods

Contents:


(C) SAP AG SCM200 1

5.2

SAP AG 2002


Supply Network Planning: Unit Objectives

Describe the Supply Network Planning distribution network

Describe the Supply Network Planning process flow

Identify the master data that is required to run Supply Network Planning

Describe and compare the planning methods used in Supply Network Planning

(C) SAP AG SCM200 2

5.3

SAP AG 2002


Demand Planning


Course Overview


Demand Management



Conclusion

(C) SAP AG SCM200 3

5.4

SAP AG 2002

Supply Network Planning Overview


APOAPO

R/3R/3


Scheduling (PP/DS)


Capacity Requirements

Planning (CRP)


Flexible PlanningStandard SOP

Demand Management Supply Network Planning (SNP)

CIF

Supply Network Planning within SAP APO SNP is used for cross-location planning of the supply and procurement network.

Supply Network Planning is based on demands that are predetermined in the form of sales orders or planned independent requirements. These demands are fulfilled by in-house production, stock transfers from other plants or by external procurement from external suppliers. It also takes into account capacity constraints of the network.

SNP is a medium-term planning tool that plans procurements roughly. The time bucket profiles (buckets) that can be seen in SNP are at least one day long. Detailed Production Planning and Detailed Scheduling using exact times then takes place in SAP APO PP/DS (or also in SAP R/3 MRP).

(C) SAP AG SCM200 4

5.5

SAP AG 2002

Advantages of Supply Network Planning in SAP APO

Cross-plant mid-term rough-cut planning

Simultaneous material planning and finite capacity planning of production, storage, and transportation resources

Simultaneous production planning and distribution resource planning

Planning of critical components on bottleneck resources

Cross-plant optimization of the resource load

Prioritization of demands and receipts

Collaborative procurement planning over the Internet

Detailed distribution planning (deployment)

Collective conversion of stock transfer requisitions

(C) SAP AG SCM200 5

5.6

SAP AG 2002

SNP Process Flow

Planning horizon

Demand Planning(plans future demands for DCs)

Supply Network Planning (SNP)(generates feasible receipts for

supply chain demands)

Production Planning/Detailed Scheduling(plans in detail the production of a

plant)

Shop floor control (SFC)

Demand Planning enables you to predict material requirements based on historical and statistical forecasting techniques. Demand planning data is usually bucket-oriented and unconstrained. The forecast data is then released to Supply Network Planning to create constrained and feasible production and distribution plans.

Supply Network Planning is usually a medium-term planning process. Production Planning and Detailed Scheduling is used for short term, order-based planning.

(C) SAP AG SCM200 6

5.7

SAP AG 2003

Demand Program

Salesorders



Material Requirements PlanningCoverage of requirements by

In-house productionExternal procurement

Forecast Plnd. ind.reqmts

Sales

Demand program

Stock transfer requirements

Demand Management pertains to the administration of independent requirements. Independent requirements can be entered directly for a production plant. They can also be derived from demand planning.

Planned independent requirements are warehouse requirements that can be derived from a forecast of the future requirement situation. In make-to-stock production, you want to initiate the procurement of the materials concerned, without having to wait for concrete sales orders. Sales orders (customer independent requirements) are created by sales and distribution. Sales orders can enter MRP directly. This is desired when customer-specific planning takes place.

Stock transfer requirements, that is, requirements from other locations of the Supply Chain (distribution centers, for example) can, in addition to the independent requirements that have been entered in the production plant, also enter the demand program.

(C) SAP AG SCM200 7

5.8

SAP AG 2003

Planning Horizons in Supply Chain Planning

Time

Demand Planning(Plans the future demands for plants, DCs, and customers)

Supply Network Planning(Cross-plant planning

of supply chain receipts)


Scheduling(Plans production of a

plant in detail)

DeploymentTLB

ManufacturingExecution

Today Planning time fence Stock transfer horizon

SNP production horizon

PP/DS horizon

Demand Planning (DP) enables you to predict customer demand by forecasting historical consumption data, for example. Demand Planning data is usually bucket-oriented and unconstrained. Forcast data is then released as planned independent requirements.

Supply Network Planning is a bucket-oriented, medium-term, cross-plant planning process that plans production outside of the SNP production horizon, and procurement outside of the stock transfer horizon.

Production Planning and Detailed Scheduling is used for short-term, order-based planning according to sequences and setup times within the PP/DS horizon. The planning run does not create any new orders within the planning time fence. In this way, production is not disrupted.

The planning time fences of SNP and PP/DS overlap if the SBNP production horizon is smaller that the PP/DS horizon. In this horizon, SNP determines the receipts that have favourable sources of supply and lot-sizes. PP/DS plans the receipts created by SNP in more detail.

Deployment and Transport Load Builder (TLB) are part of the SNP module and are used for short-term replenishment planning to adjust stock transfers according to short-term changes on both the demand and the receipt side.

(C) SAP AG SCM200 8

5.9

SAP AG 2003

Transition from Medium to Short-Term Planning

Supply Network Planning SNP BOM and routing Finite cross-plant planning Distribution and procurement Quantity-oriented and bucket-oriented No pegging

SNP planned ordersPurch. requis.Stock transfers

Production BOM and routing Finite, detailed planning per plant Sequences and setup times Continuous and order-related Pegging

Production Planning/Detailed Scheduling

Planned ordersPurch. requis.Stock transfers

TimePP/DS horizonSNP production horizon

Today

Plnd. ind. reqmts

Salesorders

Plnd. ind. reqmts

Salesorders

Network planning within SAP APO SNP takes place outside of the SNP production horizon. In the PP/DS horizon, however, Production Planning/Detailed Scheduling takes place, that is, detailed planning of procurement in a plant. It is possible, and also makes sense that the two horizons overlap, and that the PP/DS horizon is behind the SNP production horizon.

SNP Planning is based on SNP bills of material and routings, most of which are usually simplified production plans. SNP bills of material , for example, usually contain only the strategically important components for which foresighted planning is necessary, whereas procurement of the remaining components is only planned in plant-specific Detailed Scheduling. SNP planned orders that are based on this simplified master data can be converted into planned orders in Detailed Scheduling.

Pegging is the link between receipts and issues along the supply chain. When an order is shifted, all dependent orders can be adjusted automatically. This function is only available in Production Planning and Detailed Scheduling. Supply Network Planning is based purely on quantities and buckets.

(C) SAP AG SCM200 9

5.10

SAP AG 2003

Integration of SNP and PP/DS Orders

TimeToday

Start DateOperation 10

End Date Operation 30

10 3020 10 3020

SNP prod. horizon

SNP

PP/DS

PP/DShorizon

The PP/DS horizon and the SNP production horizon are both defined in calendar days from today's date onwards. The PP/DS horizon can be defined globally in the definition of the planning version. You can define both horizons for each product in the location-specific product master on the PP/DS tab page. The settings in the product master override the global settings. Both horizons can overlap to define an area where SNP may plan alongside PP/DS.

SNP planned orders can only be created or changed in SNP; PP/DS planned orders in PP/DS only. The SNP planning run only creates SNP planned orders that have an end date that is outside of the SNP horizon. Automatic PP/DS planning only covers requirements within the PP/DS horizon.

The PP planning run deletes all non-firmed SNP planned orders that have an end date within the PP/DS horizon, and creates PP/DS planned orders for the requirements (planned independent requirements, sales orders, releases for stock transfers and so on) within the PP/DS horizon.

You can also find the settings 'Fix production' and 'Fix transports' in the product master. If these indicators have not been set, SNP planned orders within the production horizon, or external procurement within the stock transfer horizon are deleted by PP/DS.

If for example, SNP planned order cover requirements outside of the PP/DS horizon, they are deleted in the PP/DS planning run and no PP/DS planned orders are created. To prevent this, the SNP planned orders must be converted into firmed PP/DS orders before the PP/DS planning run. You can trigger this conversion interactively from the product view or periodically plan a background conversion in PP/DS. During conversion, you can define whether firmed or unfirmed orders are created with or without a


conversion indicator. Moerover, you can set the lot-sizing procedure with which orders are to be created and whether the SNP sources of supply are to be copied. The end date of the SNP planned order is used in scheduling. You can find conversion under Production Planning -> Environment -> Conversion of Supply Network Planning -> Production Planning in Background


5.11

SAP AG 2002

Integration of SNP and SAP R/3

Stock transport requisitions

APOAPOR/3

R/3

Planned orders


Production orders

Plnd. indep. reqmts

Planned orders

Demand Planning



Scheduling (PP/DS)

Planned independent requirements come from SAP R/3 demand management or from SAP APO Demand Planning.

Sales orders come from the SAP R/3 Sales and Distribution module. SNP generates stock transfers and planned orders. These planned orders can either be converted into

production orders in SAP R/3, or planned in detail in SAP APO PP/DS and transferred to SAP R/3 as production orders. Detailed Scheduling can thus take place in either SAP R/3 or SAP APO.


5.12

SAP AG 2002

Purposes of Supply Network Planning

Supply Network Planning takes place in the medium to long-term horizon. It creates a rough quantity-based, cross-location production and distribution plan with individual rough-cut bills of material (BOM) and routings.

The SNP BOM contains critical products that are to be produced on bottleneck resources and products with a long replenishment lead time.

SNP ensures that the correct quantity is available on the correct day without overloading critical resources. The smallest unit used for scheduling is one day.

SNP supports make-to-stock production only.

The purpose of SNP is to match a feasible procurement plan to the demand plan (from SAP APO DP, for example). To do this, it checks global and central procurement, stock transfer, and production possibilities. It then creates a feasible solution based on this.

Simulation scenarios enable you to create and compare alternative plans. Using make-to-stock production strategies, production or procurement is planned, using planned

independent requirements that arise from the forecast of expected future sales. According to the choice of strategy, sales orders can affect requirements, consume planned independent requirements, or have no effect on planned independent requirements. In make-to-stock production, sales orders are usually fulfilled by warehouse stock. The identification number for strategies in SAP R/3 and SAP APO is usually different, because an SAP APO strategy can contain more than one SAP R/3 strategy. SNP supports the following SAP R/3 strategies: 10, make-to-stock production, and 40, planning with final assembly.


5.13

SAP AG 2002

Planning of the Complete Supply Chain

Supplier warehouse

Manufacturer DC

Customer DC


Production

plant

Supplier plant

Different planning methods can be used to create cross-location, feasible plans for material flow along the supply chain, taking demand constraints and penalty costs into account. This results in optimized purchasing, production and distribution decisions, reduced stock levels, and improved delivery reliability.

Possible demand constraints are material availability and free availability of work center capacities, storage capacities, transportation capacities and handling capacities.


5.14

SAP AG 2002

Supplier CustomerDCPlant

Locations in the Supply Network

CarrierMRParea

Stock transferpoint

Transportationzone

Locations are only differentiated by location type symbols on the map (exception: VMI)

Products can be stored at any location

Demands can be fulfilled by any location

Any location can be assigned storage, handling, supply, and production capacities.

Storage and purchase costs can be defined per location for each product.

Production, shipping, and storage calendars can be defined for each location. A handling and a storage resource can be assigned to a location to represent aggregated handling and

storage capacity. The geographical data is used to position the location on the geographical map of the Supply Chain

Engineer. Predefining it as a part of the location data forces the location to be positioned at a specific point on the map. If you leave these fields blank, they are filled automatically when you place the location on the map.

The VMI customer tab page only applies to the location type '1010' (customer). The Crr. tab page is only activated when you select the location type '1020' (Carrier).

Input fields that are not available to other location types are activated for location type '1007' (MRP area).

For each location, you can defíne costs for storage, handling, procurement and production, and penalty costs for non-delivery. Procurement costs are used to choose suppliers, and production costs to choose production process models (PPMs). An integrated cost consideration is executed during the SNP optimization run.


5.15

SAP AG 2002

Transportation Lanes

Transportation lanes control the flow of material along the supply chain

Procurement

Means of transport Products that can be

delivered by a means of transport.

Transportation capacity by volume, weight, pallets

Transportation costs per unit, product and means of transport

A transportation lane in SAP APO represents a business relationship between locations, which you can use to transport goods. The lanes and the locations represent the supply chain network. Material flow is defined by the direction of the transportation lane from start-location to destination-location. These transportation lanes enable you to: Define the product procurement parameters such as lot sizes, cost functions, unit costs, and lane

priorities Define the means of transport (truck, ship, airplane, and so on) for each lane and the related

parameters such as transportation costs, distances, and times Assign product-specific means of transport Assign carriers to the lanes.

You can view the lane-relevant data from the Supply Chain Engineer menu or on the map. You can, for example, display a list of all products that are assigned to a certain transportation lane.


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SAP AG 2002

Resource Categories

Production

Handling Storage

Transportation

You use bucket resources for the bucket-oriented, medium and long-term planning of Supply Network Planning. The smallest time unit that can be used in bucket resources is one day.

You can define the capacity of a bucket resource as: Quantity (without time base) - by defining the transportation capacity of a truck or the storage

capacity of a warehouse, for example. Rate (quantity with time base) - this defines the consumption or production capacity of a resource, for

example; in other words, the quantity that is consumed or produced on a working day at the resource. You can use transportation bucket resources to model the capacity of transport fleets in order to avoid

overloading them. You can use storage bucket resources to model the capacity of storage locations in order to avoid

overloading them. You can use handling bucket resources to model the capacity of forklifts, conveyor belts, or pipelines in

order to avoid overloading them.


5.17

SAP AG 2002

Structure of Plan and PPM

Operations:

Activities:

Product

Relationship

Resources

In/Out

Resource consumption

Sequence

Plan (location-independent)

Control costs

Material staging

Pre-assembly

Final assembly

Inspection

Produce

Tear down

Queue time

Product, location, lot-size area

PPM

The detailed information required for producing a product is specified in the plan. Each plan includes one or more operations. Each operation includes one or more activities, the components consumed by the activity, the resources used and their sequence within the operation.

The plans used for SNP are usually less detailed than those used for Production Planning and Detailed Scheduling (PP/DS).


5.18

SAP AG 2002

Options in Supply Network Planning

Finite scheduling

Capable-to-Match (CTM) and optimizer: Simultaneous quantity and capacity requirements planning, SNP resources and material availability are checked when creating orders.

Infinite scheduling

Heuristic: Resources and material availability are not checked when creating planned orders and SNP stock transfers.

Medium to long-term planning strategies

Short-term replenishment planning (deployment)

Heuristic and optimizer: Adapts stock transfers to the current demand/receipt situation.

Transport Load Builder (TLB): Groups together stock transfers

Supply Network Planning in SAP APO can be executed as finite or infinite planning. Capacities are not checked in infinite production planning. Receipts (planned orders and SNP stock

transfers) are created with appropriate dates, even when no remaining capacity is available. Even when components cannot be procured on time, planned orders are still created. Capacity requirements planning then takes place in a second step.

During finite planning, when receipts are being created, the availability of capacities and components needed for production is checked. Only when sufficient capacity is available can the planned order be created. If there is no capacity remaining for the desired time, the planned order is created earlier or later (when capacity is available) and this delay is indicated by a corresponding alert. CTM and the optimizer create feasible medium term procurement, production, and distribution plans.

Deployment distributes the stocks and available receipts from the plants to the DC and vendor managed inventory customers (VMI). Stock transfers are adjusted to the current situation.

The Transport Load Builder takes transportation capacities into account and groups together the deployment stock transfers into TLB shipments.


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SAP AG 2002

SNP Process Flow

Perform SNP heuristic,optimization, or CTM run

Finalize SNP plan (available to PP/DS)

Check plan/Solve problems

Deploymentrun

Release constraint-based SNP plan

to DP

TLB run

Build shipments fornon-assigned

deployment orders

Set up master data andsupply chain model

Release demand plan

When the demand plan is released from Demand Planning, planned independent requirements are created for SNP or PP/DS. Either the demand planner or the SNP planner can perform this step.

Performing the SNP run using the SNP heuristic, SNP optimization, or Capable-to-Match results in a medium term production and distribution plan.

After the SNP run, check the exception messages (alerts) and solve any existing problems. The final SNP plan consists of SNP stock transfers, and SNP planned orders. SNP planned orders can be

automatically converted into PP/DS planned orders in the production horizon. Production Planning and Detailed Scheduling (PP/DS) uses these PP/DS planned orders as a basis for removing detailed bottlenecks and to create a feasible production plan.

The final SNP plan can be returned to DP to compare the unconstrained demand plan with the constrained SNP plan.

Once production planning has been completed, the deployment run confirms the SNP stock transfers based on current receipts and demands.

The TLB run groups the confirmed deployment stock transfers resulting from the deployment run into TLB shipments.


5.20

SAP AG 2002

SNP Planning Using Heuristics

70%

30%

3. Explosion of PPMCreate and schedule receipts

2. Valid transportation lanes, quota arrangements, priorities

Quantity-based, rapid, cross-plant planning

Planning against infinite capacities Time-based aggregation (on weekly bucket profiles, for example)

1

2

1. Demandno stock

The role of the heuristic is: To plan supply to cover demands, without taking demand constraints such as available capacities and material availability into consideration (infinite planning); cross-plant bucket-oriented planning of receipts for purchasing, production, and distribution in the complete delivery network; and finally, the synchronization of activities and planning of material flow throughout the whole supply chain.

This graphic shows an example of the heuristic procedure. There is a demand in the distribution center. The net requirements calculation finds no stock. The

product is procured externally. The system analyzes possible transportation lanes. The demand is distributed according to quota arrangements and passed on to the plants using stock transfers.

There is no stock in the plants, the SNP plans (PPMs) are thus exploded, planned orders are created for the finished product, and dependent requirements are created for the components. The planned order with the higher quota arrangement in the plant is not feasible due to capacity reasons. An alert is generated and the planner has to step in interactively.

Procurement for components takes place over the possible transportation lanes according to quota arrangements or priorities. The supplier with the highest priority cannot deliver enough. An alert is generated and the planner has to step in.

The heuristic can thus be implemented for rapid, cross-plant distribution and procurement planning, for example, if demand constraints do not play a role.


5.21

SAP AG 2002

Capacity Leveling

Capacity load

100 %

BACKWARD FORWARD

Time-based capacity leveling

Day 1 Day 2 Day 3 Day 4 Day 4

The planner can use the following procedure to adjust the plan to the available capacities: Backward scheduling of the capacity load to satisfy demand with high priorities without due date

violations. This rescheduling does not create any orders in the production horizon, however. Forward scheduling of the capacity load related to demand with lower priorities and minimization of due date violations based on demand priorities.

A combination of backward and forward scheduling of capacity load. If you choose time-based capacity leveling, you can select different priority rules. If you do not select a

priority rule, the priority is determined by the system and is completely random. If, for example, you choose "Time-Based Capacity-Leveling by decreasing order quantity", the system levels the largest order first, then the second largest and so on. If you choose "Time-Based Capacity-Leveling by decreasing storage capacity", the system levels the order with the largest storage capacity, then the one with the second largest and so on. If you choose "Time-Based Capacity-Leveling by decreasing product priority", the system levels the order with the highest priority, then the one with the second largest priority and so on.

Product priority is maintained in the product location master record on the SNP2 tab page.


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SAP AG 2002

SNP Planning Using Capable-to-Match (CTM)

Order-based, cross-plant planning

Planning against finite work center capacities Prioritization using rules Determination of the first feasible solution

30%

70%

1. Demandno stock

1

2

3. Explosion of PPMschedule receipts, check capacity requirements and component availability

2. Valid transportation lanes, quota arrangements, priorities

Capable-to-Match (CTM) is a rules-controlled, cross-plant planning procedure that takes demand constraints such as available capacity and material availability into account in the planning run.

The feasibility of receipts is successively checked according to priorities or capacities and the first feasible solution is planned.

Capable-to-Match (CTM) sequentially levels prioritized customer requirements and forecasts against feasible receipts in the network, during which component availability and production capacities are considered on a multi-level basis. CTM plans the first feasible solution. This is not necessarily the optimal solution for subsequent demands.

This slide shows an example of CTM: There is a demand at the distribution center. The net requirements calculation finds no stock. The

product is procured externally. The system analyzes possible transportation lanes. CTM checks the procurement of the finished product and of the components from the plant with the higher quota arrangement. The complete amount cannot be procured. Procurement is distributed according to feasability and passed on to the plants as stock transfers.

There is no stock in the plants, the SNP plans (PPMs) are thus exploded, planned orders are created for the finished product, and dependent requirements are created for the components. There is capacity in the plants to fulfill the planned orders. The planner does not need to step in.


Procurement for components takes place over the possible transportation lanes according to quota arrangements or priorities. The suppliers are able to supply enough. The planner does not need to step in.


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SAP AG 2002

Results of CTM Planning

1.2.3.4.5.6.

7.8.9.

10.11.

CategorizedStocks

Prioritized demandsCapable-to-Match

Multi-site capacity and transportation capability check

In the CTM planning run, prioritized demands are leveled against available stocks and receipts. The receipts and demands are then leveled taking production capacities and transportation possibilities into account.

The execution of a CTM planning run in the SNP environment produces a medium term production and distribution plan.

CTM complements SNP's cross-plant supply chain planning strategies. Its purpose is to perform a quick check of production capacities and transportation capabilities based on a set of categorized supplies and prioritized demands.

CTM takes the following into account: Individual requirements, production capacity, component availability, location priority and requirement priority, Pegging, ATP rules for product substitution and splitting production between several resources. However, it does not take handling, storage, or transportation capacities into account.

CTM is an order-based planning tool that uses pegging methods to track orders back to the individual requirement. Strictly speaking, CTM is therefore not quite SNP planning, because it provides quantity planning rather than order-based planning. Nevertheless, CTM is considered in this unit, because it deals with a form of cross-plant planning. After the optimization run (or after the heuristic run), it is no longer possible to assign planned production orders or stock transfers to the original customer order.


5.24

SAP AG 2002

Supply Network Planning Using the Optimizer

Quantity-based, cross-plant planning

Planning against finite work center capacities, storage capacities, and transportation capacities

Prioritization using control costs

Determination of the first feasible and optimal solution

1. Demandno stock

3. Explosion of PPMschedule receipts, check costs and component availability

2. Valid transportation lanes and costs

The SNP optimizer is a cost-based, cross-plant planning procedure that takes demand constraints such as available capacity and material availability into account in the planning run.

The optimization run (like the heuristic run) is a quantity-based planning without pegging. It is not possible to assign planned production orders or stock transfers to the original sales order.

This slide shows an example of the optimizer: There is a demand in the distribution center. The net requirements calculation finds no stock. The

product is procured externally. The system analyzes the possible transportation lanes. The optimizer globally checks the most cost-effective procurement of the finished product and of the components. The complete amount cannot be procured in the most cost-effective plant. Procurement is distributed according to feasability and costs and passed on to the plants as stock transfers.

There is no stock in the plants, the SNP plans (PPMs) are thus exploded, planned orders are created for the finished product, and dependent requirements are created for the components. There is capacity in the plants to fulfill the planned orders. The planner does not need to step in.

Procurement for components takes place over the possible transportation lanes according to quota arrangements or priorities. The suppliers are able to supply enough. The planner does not need to step in.

The optimizer takes into account periodic total demands, production capacities, handling capacities, storage capacities, and transportation capacities, component availability, receipt and demand priority using control costs, and the splitting of production between several resources.


5.25

SAP AG 2002

How the Optimizer Works

Simultaneous product and resource planning

Feasible receipts: Planned orders, stock transfers andpurchase requisitions

Optimizer

Result:

Constraints:

Product priority

Production capacity

Storage capacity

Transportation capacity

Lot sizes

Safety stock

Location products

Horizons

The optimizer uses linear programming to consider all relevant factors simultaneously. It compares alternative solutions for the incurred costs and proposes the best feasible solution based on constraints defined in the system. You also use the control costs to configure your priorities such as minimizing delays or minimizing on-hand stock. The optimizer considers all constraints in the supply chain model that were activated in the optimizer profile. As more constraints are activated, the optimization problem becomes more complex and the time required to solve the problem increases.

The feasibility of the receipts is checked globally and the most cost-effective, feasible solution is planned. Prioritization is controlled using control costs, that are maintained in SAP APO (exception: Procurement costs from purchasing info records, scheduling agreements or contracts). The optimizer ignores quota arrangements. They can, however, be optimized and created in the planning run.

The optimization run (like the heuristic run) is a quantity-based planning without pegging. It cannot assign planned production orders or purchase requisitions to the original sales order.


5.26

SAP AG 2002

Purposes of Optimization

What should be optimized?

Optimal costs Optimal service level

Prerequisite:

"Real" variable costs or an adequate good estimate

Prerequisite:

"Simplified" costs accepted (Control costs)

Non-delivery costs =sales price + surcharge forcustomer loss/dissatisfaction

Non-delivery costs = highStorage costs = > 0, << NDOther costs = << ND

"Optimal service level" on this graphic shows the simpler configuration. You maintain high non-delivery costs (NC) and storage costs for the finished products using mass maintenance. The high non-delivery costs force the optimizer to exhaust all possible procurement and production capacities to satisfy the demands. The storage costs make sure that procurement and production are carried out as late as possible.

"Optimal costs" on this graphic shows the more complex configuration. You maintain realistic costs for procurement, production, transportation, and storage. You model lost sales and customer dissatisfaction using delay and non-delivery costs. In this scenario the optimizer uses the costs to determine the most cost-effective integrated solution.

The result of the optimization run is an optimal solution (minimum costs or maximum profit) taking account of planning-relevant transportation, production, storage, and handling constraints. In that sense, the solution is feasible. However, the result might be that due-date constraints are violated or safety stocks are not filled. Due-dates and safety stocks are considered to be soft constraints. There are costs associated with such violations, so the optimizer only proposes this solution if, according to the costs specified in the system, it is the most cost-effective solution.


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SAP AG 2002

Comparison of SNP Strategies (1)

Demand at a location

Dependent demand at loc.

Process flow

Heuristic: Optimizer:

CTM:

The heuristic is a rapid infinite planning method that generates alerts when there is a material shortfall or resource overload.

CTM is a rules-based method with extensive prioritization capabilities and finite, global planning of production resources. CTM provides order-based planning, using pegging methods to track orders back to the individual requirement.

The optimizer considers material and resource availability simultaneously. It uses linear programming to consider all relevant factors simultaneously as one problem. In other words, sequential processing is not used to determine a solution. The optimizer considers transportation, production, storage, and handling costs to propose a minimum cost solution that meets the respective constraints.

The lack of pegging of orders back to the individual requirement has the following repercussions: No order-based planning takes place in Supply Network Planning. After the optimization run (or after the heuristic run), no information relating to connections between particular planned production orders and original sales orders can be determined (however, CTM can provide such information through order tracking).


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SAP AG 2002

Comparison of SNP Strategies (2)

Speed

Quality

Prod. resources

Other resources

Multi-level

Costs

Priorities

Quota arrangements

Heuristic Optimizer CTM

+

-

2. Step, local

-

+

-

-

+

-

+

global +

global +

+

+

Product/location

creates

global +

-

+

-

Location / prod.+

+

The performance of the three planning methods can be approximated as follows: The heuristic is the fastest method, CTM is the second fastest and the optimizer is the most complex and the slowest method. This statement is only a rough guideline: If you plan a lot of orders per period and location product, the performance of CTM and the optimizer is comparable since planning in CTM is order-based.

The quality of the planning results will be worst using the heuristic (infinite planning), the next best result should be reached using CTM and finally, the best result is expected when using the optimizer, as this algorithm weighs up all possibilities.

The optimizer and CTM consider resources globally and finitely, while the infinite planning result of the heuristic must be postprocessed interactively.

The optimizer can consider transportation, storage and handling resources can be considered globally and finitely, while the infinite planning result of CTM and the heuristic can be postprocessed interactively.

Costs are only relevant to the optimizer. CTM planning is controlled using priorities. There are product, location, order and due date,

procurement and stock transfer priorities. You set priorities for the optimizer using penalty costs for late delivery and non-delivery.

Quota arrangements are used by the heuristic and CTM. They can be optimized using the optimizer.


5.29

SAP AG 2002

Supply Network Planning: Unit Summary

You can display the distribution network of Supply Network Planning using the Supply Chain Engineer.The distribution network is made up of locations and their reciprocal supply relationships.

Supply Network Planning is a rough-cut planning tool in the medium to long-term time horizon.Production Planning/Detailed Scheduling then follows on in the production horizon.

Supply Network Planning can be executed using three planning methods: Heuristic, CTM, and the optimizer.

Supply Network Planning results in feasible production and procurement plans.


5.30Supply Network Planning Exercises

Unit: Supply Network PlanningTopic: Interactive Planning


Call up interactive planning in SNP

Execute the heuristic run

Evaluate the capacity situation for a resource

Pumps with the material number T-F2## (## represents your group number) are planned in SAP APO. In the first step of planning, a demand plan is created in SAP APO Demand Planning and then released to Supply Network Planning (APO SNP) Using the SNP Heuristic, a rough production and distribution plan is created in SNP, and checked in the production plants for capacity overloads.

1-1 Carry out interactive SNP planning for product T-F2## in distribution center 2400. In doing so, plan the requirements that were released from SAP APO demand planning.

1-1-1 Call up the transaction Interactive Supply Network Planning from the SNP menu. To edit the planning situation for product T-F2## in location 2400, choose Selection Window in the top left screen area. First of all, select “APO Location Product” (in the “Show” field). Version 000 is already displayed automatically. In the next row, enter APO –Location Product once again, and on the right-hand side enter your product T-F2##. Copy the selection.

Finally, load the data for location 2400 (that is, product T-F2##) in the planning table, by double-clicking on the corresponding selection line.

The planning data that previously existed (total demands) is displayed on the right-hand side of the screen: Here you can see the forecasted sales figures for location 2400.

1-1-2 Check whether the planned independent requirements that you released are also displayed for distribution center 2500 and plant 1000. (Load the data by double-clicking on the corresponding selection line in the selection screen). Make sure that no receipts exist yet.

1-1-3 In which key figure are the planned independent requirements shown? (To answer this question, double-click on the field “total demand”).

__________________________________________________

1-1-4 Make sure that no distributed demands and production orders exist for production plants 1000 and 2300.


1-2 Plan the procurement network:

1-2-1 Proceed to the Change mode and run the Heuristic (network), by choosing the corresponding button in the above right area of the screen. Note the message that is displayed at the end of planning. How many location products were planned?

_________________________________________________

1-2-2 Check the situation for product T-F2## for distribution center 2400 (Save your planning if the system prompts you to). Were receipt elements created?

_________________________________________________

Which plants supply the receipts? (Look at the details of a cell using a right mouse click for the key figure (planned) distribution receipts).

_________________________________________________

1-3 Check the capacity situation for resource T-L## in plant 1000 in the Capacity View:

1-3-1 Change the data view, by double-clicking on Planning book/data view CAPACITY CHECK in the bottom right area of the screen.

Open the selection window and, under Show, select APO Resource. Version 000 is displayed automatically. In the next line, add APO resource again and enter Ressource WT-L##_1000_001. Load the data for the resource into the planning table. Are available capacity and capacity consumption displayed for this resource?

_________________________________________________

Are there any capacity overloads?

_________________________________________________

1-3-2 If there are any capacity overloads, run Capacity Leveling in the change mode, by choosing the corresponding button. First of all, choose Capacity Leveling by forward scheduling and finally Time-based capacity leveling without priority rule. The maximum load should be 100% and result quantities should not be fixed. Save the result and select again.

Do capacity overloads still occur on resource WT-L##_1000_001?

_________________________________________________

If so, when do the violations occur?____________________

_________________________________________________


5.31Supply Network Planning Solutions

Unit: Supply Network PlanningTopic: Interactive Planning

1-1 SAP APO menu path: Supply Network Planning Planning Interactive Supply Network Planning

1-1-1

1-1-2

1-1-3 Planned independent requirements key figure: Planned independent requirements are displayed in the key figure “Forecast”.

1-2

1-2-1 Number of planned location products: 4 location products were planned: Produkt T-F2## in locations 1000, 2300, 2400 and 2500.

1-2-2 Receipt elements created? Yes, receipt elements were created, these being “Distribution receipts (planned)”.

Which plants deliver the receipts? The receipts are delivered from production plants 1000 and 2300.

1-3

1-3-1 Available capacity and capacity consumption displayed? Yes, both available capacity and capacity consumption are displayed.

Capacity overloads? Varies. As a rule, capacity overloads occur at the beginning of the SNP planning period.

1-3-2 Further capacity overloads? Varies. As a rule, no further overloads occur.

If yes, when do capacity violations occur? It varies.


6

SAP AG 2003

Material Requirements Planning (SAP R/3 MRP)

Consumption-Based Planning and Materials Requirements Planning

Multilevel Requirements Planning

Internal and External Procurement

Scheduling and BOM Explosion

MRP Evaluations

MRP and Capacity Planning

Contents:


(C) SAP AG SCM200 1

6.2

SAP AG 2003

Describe the functions of SAP R/3 Material Requirements Planning

Execute and evaluate multilevel requirements planning

Explain scheduling for in-house production and external procurement

Explain the connection between MRP and Capacity Planning


Material Requirements Planning: Unit Objectives

(C) SAP AG SCM200 2

6.3

SAP AG 2003


Demand Planning


Course Overview


Demand Management



Conclusion

(C) SAP AG SCM200 3

6.4

SAP AG 2003

Material Requirements Planning Overview


APOAPO

R/3R/3


Standard SOP

Sales

CIF

Global Available-to-Promise (ATP)



Scheduling (PP/DS)


Demand Management

Capacity RequirementsPlanning (CRP)

SAP R/3 Material Requirements Planning (MRP) can be executed as consumption-based planning or as material requirements planning.

MRP takes place based on independent requirements for the finished product (or for an assembly): The independent requirements are created as planned independent requirements or sales orders (customer independent requirements) in demand management, that is, in sales and distribution and are included in MRP.

In multilevel requirements planning, the entire BOM structure is planned using "dependent requirements" that are based on independent requirements. In this way, material availability in multilevel production is ensured.

Capacity planning can follow on from MRP (which in SAP R/3, takes place based on infinite capacities) as an additional step.

It is also possible to transfer SNP planned orders from SAP APO to SAP R/3. A MRP is then executed for the assemblies and components of these planned orders in SAP R/3.

For PP/DS planned or production orders a MRP also takes place in SAP R/3 for those components, that are not planned in SAP APO.

(C) SAP AG SCM200 4

6.5

SAP AG 2003

MRP Procedures

How should I plan material requirements in SAP R/3?Material master

MRP1

MRP Type


PD

Further control via requirements strategies (MRP3)

Reorder-Point PlanningVB

Consumption-Based Planning

Based on independent requirements

Forecast-Based PlanningVV

Time-Phased PlanningR1...

...

Based on consumption in the past

...

The basic planning type is defined per material using the MRP type, that is entered in the MRP 1 view of the material master. Planning of a material can be MRP or consumption-based. A material can also be excluded from MRP using the corresponding MRP type.

Material requirements planning takes current and future sales as its reference point and is executed for the whole BOM structure. The planned requirements quantity (in the form of planned independent requirements or sales orders) triggers requirements calculation.

Consumption-based planning is based on consumption values in the past and uses forecast or statistical procedures to determine future requirements. Consumption-based planning is characterized by its simplicity and is mainly used for "B and C parts", or in other words, those with low values.

If MRP for a material takes place in SAP APO, you need to define the SAP R/3 MRP type, so that the material doesn't take part in the planning in SAP R/3.

(C) SAP AG SCM200 5

6.6

SAP AG 2003

Consumption-Based Planning

Using reorder point planning as an example

Stock Lot Size

TimeReorder point Delivery time-spot

Replenishmentlead time

Reorderstock

Safetystock

Manual reorder point planning is a typical process in consumption-based planning. It is characterized by its simplicity.

You control the planning using a manually entered reorder point (for example, 50 pieces). During the planning run, the system checks only whether stock has fallen below this reorder point or not (that is, whether there are less than 50 pieces in stock). If that is the case, the system triggers procurement to the amount of the lot size (a fixed lot size of 500 pieces for example).

If schedule lines are created directly by the planning run, for example, for materials procured externally, the administrative work for this sort of planning is minimal.

Reorder point planning is appropriate only for materials with demand that stays relatively consistent. Real-time inventory management is also necessary.

(C) SAP AG SCM200 6

6.7

SAP AG 2003

Net Requirements Calculation

in Material Requirements Planning

Firmed planned ordersFirmed purchase

requisitions

Procurement proposal lot-size

Stock

Material shortage

Safety stock

Reqmts

(Sales orders, planned independent

requirements, secondary

requirements, reservations, and so

on)

Firmed receiptsPurchase orders, for example Within the

rescheduling horizon

In MRP, a net requirements calculation is also executed in the planning run to determine whether a material shortage exists for a certain material. In addition, stock and fixed receipts that currently exist (purchase orders, production orders, fixed purchase requisitions and planned orders...) are compared with the safety stock and requirements. The result of this comparison is the quantity available for planning.

If the quantity available for planning is lower than zero, a material shortage exists. MRP reacts to material shortages by creating new procurement proposals, that is, by creating purchase requisitions or planned orders, independently of their procurement type. The suggested procurement quantity results from the lot-sizing procedure, that is set in the material master.

(C) SAP AG SCM200 7

6.8

SAP AG 2003

Procurement Types

Subcontracting30

Stock transfer from own plant40

Material master

MRP 2

Procurement type ...Special procurement ...

In-house productionE

External procurementF

Both procurement typesX

In-house production External procurement

…

Production in own plant

Production in another plant80

Further determination of procurement types via special procurement types (needs to be

defined in Customizing)

The procurement type defines whether a material is produced in-house or whether it is procured externally.

The procurement type is predefined by the material type in Customizing for the Material Master and is defined in the material master record (MRP data screen 1, procurement type field).

If the procurement type allows both in-house production and external procurement, the system always uses in-house production.

A different type of procurement to in-house production or external procurement can be set using the special procurement key in the material master. Special procurement types are defined in Customizing (Customizing step Define special procurement type); Special procurement types are thus assigned a procurement type, defining the procurement type more precisely.

In this unit, we will concentrate on in-house production.

(C) SAP AG SCM200 8

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SAP AG 2003

MRP Run

PlanningTotal planning

Online

As background job

Ind. planning Multilevel

Single-levelInteractive

Planning of all materials of one or several plants

Planning of a material's BOMPlanning of a materialInd. planning

Ind. planning Interactive single-level planning

You can carry out the planning run on two levels: as total planning for a plant or for an individual material. It is thus possible to execute a total planning run for several plants and/or MRP areas.

You can execute a single-item planning run either for a specific material only (single level) or for all BOM levels (multi level). Interactive planning of a material is also possible.

A total planning run can be executed online or as a background job. Total planning for a plant encompasses all materials relevant to MRP for this plant and includes the

BOM explosion for materials with BOMs. From the MRP menu, you can execute total planning "Online" or "As background job". In order to

execute the total planning run as a background job, you select a report variant limiting it to the corresponding plant and plan the job.

A user exit enables you to limit the total planning run specifically to those materials which fulfill freely definable criteria. You can use this, for example, to select all the materials belonging to a particular MRP controller.

(C) SAP AG SCM200 9

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Scope of the Planning Run

Processing key NEUPL Regenerative planning

Planning of all MRP-relevant materials

Processing key NETCH Net change for total horizon

Planning all materials which have undergone a change relevant to the planning run

Processing key NETPL Net change for planning horizon

Planning all materials for which MRP-relevant changes have been made in the planning horizon

Planning within the planning horizon only

During regenerative planning, the system plans all materials of a plant. This is practical when carrying out the planning run for the first time and on rare occasions when, due to technical errors, the consistency of the data cannot be guaranteed.

In a working plant, it usually makes sense (especially when you are using many materials) to only carry out MRP for those materials that have undergone MRP-relevant changes (through goods issues, new sales orders, changes to the BOM struscture, for example). Due to its short run-time, net change planning - which is used to plan these materials only - enables you to carry out the planning run in short time intervals, so that you can always work with the current planning result.

During net change planning in the planning horizon, the system only takes changes within the planning horizon into account. The system plans only those materials that have been subject to an MRP-change within the planning horizon. The materials are planned within this horizon only.

You set the planning horizon in Customizing for MRP as a plant or MRP group parameter. The planning horizon should at least span the time period in which sales orders are received, and, furthermore, contain the delivery and total lead times for the material.

You specify the type of planning run via the "processing key" field in the initial screen for planning. In single-item planning, you are only able to differentiate whether "net change planning" (NETCH) or "net change planning in the planning horizon" (NETPL) is to be performed. In total planning, you also have the option of using the key NEUPL, with which all materials in the planning file are planned.


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Control Parameters for MRP

Processing key

NEUPLNETCHNETPL

Create purch. requisition

123

in the opening period for planned orders

Schedule lines

123

in the opening period for planned orders

Create MRP list

123

only for exception messagesnever

Planning mode

123

New BOM and routingDelete planning data

Adjust data

MRP Group

always

The following control parameters for MRP are required for the planning run: Processing key: You define the planning type as regenerative planning or net change planning over the

whole period or restricted to the planning horizon. The indicators "Create purchase requisition" and "Schedule lines" are only relevant for materals that are

procured externally. You can determine whether or in which period purchase requisitions and schedule lines are required as the result of the planning run.

You can determine further whether the planning run is to generate MRP lists. It is also possible to have the system generate MRP lists only when certain exception messages have appeared for a material (the exception messages that should trigger an MRP list to be generated can be defined in the Customizing IMG activity "Define and group exception messages").

The planning mode defines whether the existing planning data should simply be adjusted, whether BOMs and routings should also be re-exploded or whether the planning should be started from the very beginning again.

You can also set the creation indicator for purchase requisitions, schedule lines and MRP lists in the MRP group. The materials that are assigned to this MRP group are then planned accordingly in the total planning run.


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Material Requirements Planning: Results

In-house production

External procurement

Convert

Planned order

Productionorder

Process order

MRPMaterial A

Directly possible for externally procured

materials only


Schedule lines

Purchase order

If MRP discovers shortage quantities, procurement proposals are generated: purchase requisitions and planned orders are internal planning elements which can be changed, rescheduled or deleted at any time.

In the case of in-house production, the system creates planned orders for the planning of production quantities. When planning is complete, plannned orders can be converted into production orders.

In the case of external procurement, the system creates either a planned order, or directly creates a purchase requisition, or a schedule line for a pre-existing scheduling agreement for planning the external purchase order quantity. When planning is complete, planned orders can be converted into purchase requisitions and, at a later date, the purchase requisitions can be converted into purchase orders.

You control whether the system immediately creates purchase requisitions or firstly creates planned orders for externally procured materials in the initial screen of the planning run using the "creation" indicator for purchase requisitions.

If a scheduling agreement exists for a material and is relevant to MRP in the source list, then you can also create schedule lines directly in MRP. You control this using the creation indicator for schedule lines in the initial screen of the planning run.


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Multilevel Material Requirements Planning

Purch. requis.

MRPComponent 1

Planned orderDep.req.

...

Planned Order

MRPAssembly 2

Dep.req.

MRPAssembly 1

Dep.req.

MRPFinished Product

Sales Order,FCreq.

Single-item, multilevel planning

Single-item, single-level

planning

MRP can be executed as total planning for all materials or as individual planning. The task of individual planning is to plan a material separately (for example, interactively), whereas

multilevel individual planning takes place over all BOM levels of this material. In single-level planning it is only the header material that is planned. In multilevel planning, dependent requirements are thus also planned.

Secondary requirements that arise from the planning of a finished product's BOM components, are set via secondary requirements, that arise from the explosion of a material's BOM. Dependent requirements depend on respective planned orders. Materials (assemblies) are needed to realize these planned orders.

If a planned order is converted into a production order, the dependent requirements are transferred to order reservations.


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Mutilevel Backward Scheduling

Time

Reqmts dateFinished product

Finished product

Assembly 1

Assembly 2

Component 1

Today Planned orderPurchase requisition

MRP uses backward scheduling - the system calculates the necessary start dates based on a predefined end date.

MRP reacts to the requirements needed for the finished product (a sales order, for example) Procurement proposals are created for the finished product and dependent requirements for the components are calculated via the BOM explosion. The dependent requirements date arises from the start date of the planned order that caused the requirements.

MRP reacts to the requirements needed for the finished product (a sales order, for example) Procurement proposals are created for the finished product and dependent requirements for the components are calculated via the BOM explosion. The dependent requirements date arises from the start date of the planned order that caused the requirements.


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Backward Scheduling for In-House Production

Time

Planned order

Goods receiptprocessing time

In-house prod. timeOpening period

Availabilitydate

Order startdate

Order finishdate

Openingdate

With materials planned using MRP, future requirements dates are known. Backward scheduling is used for these materials.

With backward scheduling, the system determines the order finish date by calculating the goods receipt processing time backwards from the requirements date. This specifies the number of workdays that are required after the receipt of the goods for checking the material and placing it in storage. You define this in the MRP data 2 screen of the material master.

The system calculates starting from the order finish date backwards by the in-house production time to determine the order start date. The in-house production time comprises the lead time and floats. You can maintain the in-house production time either in the material master as a value independent of the lot size or as a value dependent on the lot (work scheduling).

With the in-house production time independent of the lot, the system determines the basic dates independent of the order quantity. With in-house production time dependent on the lot, the system determines the time depending on the order lot size. Setup time and queue time, that are included in the in-house production time, are independent of the lot.

The opening period is then subtracted from the order start date. This calculates the opening date. The opening period reflects the processing time that the MRP controller requires to convert planned

orders. The opening time is defined as a float of the scheduling margin key.


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Forward Scheduling for In-House Production

Happens automatically, if order start date is in the past duringbackward scheduling

Time

Planned order

Goods receiptprocessing time

In-house prod. time

Availabilitydate

Order finishdate

Today

Order startdate

If during backward scheduling of materials planned using MRP, the system determines an order start date that is in the past, the system automatically switches to forward scheduling.

With forward scheduling, the system sets the current date as the order start date. The in-house production time is added to the current date, which in turn determines the order finish date. The goods receipt processing time is added to the order finish date in order to determine the availability date.

In Customizing for MRP, in the IMG activity "Parameters for determining the basic dates", you can define for each plant that the system is not to automatically switch to forward scheduling when determining the basic dates if the order start date is in the past. If the indicator is set, backward scheduling is always used to determine the basic dates even if the start date is in the past.


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Scheduling for External Procurement

In-house prod. time

Planned delivery time

Processing time for purchasing

Delivery dateRelease date

... ...

Order startdate

Order finishdate

Time

Scheduling for externally-procured materials takes place at the same time as for materials that are produced in-house: The element in-house production time is replaced with the sum of purchasing department processing time and planned delivery time.

You define the purchasing department processing time in Customizing as a plant parameter in workdays. The planned delivery time is in calendar days. It can be determined on a non-vendor-specific or vendor-

specific basis. You maintain the non-vendor-specific planned delivery time in the material master (view "MRP 2").

You enter a vendor-specific planned delivery time in the purchasing info record or in the outline agreement. It is used in the planning run, if the indicator "Scheduling info record/agreement" in Customizing is maintained as a plant parameter or MRP group parameter and if, in the area of automatic source determination, an individual vendor can be assigned.


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Stock/Requirements List and MRP ListM

ater

ial t

ree

MRPelements

Elements

Variable header

General structure Current stock/reqmts.list

Planned orders Purch. requisitions Production orders Purchase orders ... Plant stock/ Storage location stock Sales orders Plnd. ind. requirements ...

Current

MRP list

Planningrun

The current stock / requirements list contains up-to-date information on the current status of stocks, requirements and receipts. You are able to view any changes immediately. This can be done as soon as the current stock / requirements list is called up or, upon displaying the current stock / requirements list, the elements are re-read from the database using the "Refresh" function.

The MRP list depicts the result of the latest planning run and is therefore static: Changes that are made after the planning run cannot be seen. You can control whether or not an MRP list is generated during the planning run.

The basic structure of both lists is the same: Links are in the form of a tree for the worklist of the MRP controller. Above the list is the header with the material number. You can display additional data in the header

details. The list itself contains the individual MRP elements and the corresponding available quantities.

User-specific settings enable you to adapt the lists to personal requirements - these apply to both lists (see the corresponding Customizing documentation in the evaluations for MRP "Configure MRP list / stock/requirements list"). You can display additional data, which can then be accessed using a function key, over a customer exit (see Customizing, "Customer-Exit: Program additional columns")


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Functions of the Current Stock/Requirements List

Header data Material master data Stocks Consumption values

User-specific

Actions for MRP elements Display Change Convert Pegged requirements ... Order ReportGo to

Capacitycheck

Receipts

Reqmts

Variable header

Planning segments

Processing Material memo Search Stock statistics ...

User-specific

Display

Period totals Reqmts grouping Variable date display

user-specific

The current stock/requirements list, like the MRP list offers several display options: You can display different dates (the availability date or the goods receipt date, with/without safety time). You can work with display filters and selection rules, you can work in the period totals display and so on. You can define the display accordingly in your personal settings.

"Period totals" is a display function in the MRP list and stock/requirements list evaluations which groups the planning results into periodic buckets (for example, weekly or monthly buckets). In the Customizing IMG activity "Define period display for period totals", you define which periods are to be depicted when you display the period totals. The periods selected here are displayed on various tab pages in the period totals display.

You can analyze the capacity situation from the stock/requirements list. For this, the system displays the available capacity, and the total capacity requirements of this material are displayed for each work center and capacity category. Overload situations are highlighted in color. You should note that planned orders that have not been scheduled using detailed scheduling do not create capacity requirements.

The functions in the MRP list are, for example, those related to the processing of MRP elements or are display options. To a large extent, these functions are identical to those in the stock/requirements list. Selection rules, however, are only used in the stock/requirements list. In contrast to the stock/requirements list, you can set a processing indicator for the MRP list. This indicator serves to highlight lists that have already been processed (that is, managed) by the MRP controller.


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Special Functions: Filter and Navigation Profile

Navigation profileList

Display -filter

MRP listCurrent stock/reqmts.list

MRP listCurrent stock/reqmts.list

Transaction calls...Context-sensitive

You can influence the display in the lists using filters. You define if selection rules and display filters are to be used when accessing the list. This is done by choosing the indicator "With filter" in the initial screen, or in the list itself by choosing the icon "Filter on", or in the user-specific settings.

There are two types of filters, the display filters and selection rules. Selection rules apply to the stock/requirements list only. You define which MRP elements are displayed and which of these elements are used in the calculation of the available quantity. They enable the analysis in the stock/requirements list of various planning situations that are different with regard to the MRP elements that are taken into account. Selection rules have no influence on the calculation of requirements! You define these in the Customizing IMG activity "Define selection rules".

Display filters are used in the stock/requirements list and in the MRP list. Display filters have no influence on the MRP elements that are used in the calculation of the available quantity. You define display filters in the Customizing IMG activity "Define display filter".

A navigation profile contains transaction calls for transactions that are accessed directly from the stock/requirements list or the MRP list. The transactions are either general, (meaning actions at material level), or they refer to a particular MRP element. Only the transaction calls that are valid in the current context are displayed.


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Personal Settings

for the current stock/reqmts list and the MRP list

Settings for user TEMPLATE

Display Header details Overview tree Individual segments Requirements

grouping

Date Reqmts/avail.date Safety time Complete

replenishment lead time

General settings Unit of measure Checking rule Navigation profile

Buckets Single line - display Period totals display

Filter Access with filter Display filter Selection rule

+ Own favorites

The screen for the stock/requirements list and the MRP list offers a number of options that can be set on a user-specific basis.

Your personal settings (as well as your "Own favorites") determine the screen that appears when accessing the lists. From the lists, you can change the various user-specific default settings at any time - for example, you can show or hide the overview tree.


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Collective Access of MRP Lists

Materials overview

Select materials Utilities:

Traffic lights Processing indicator New exceptions Sort Search

in the overview in individual lists

Processing

MRP listMRP list

Selection according to:

MRP controller Product group

Restrict further using:

MRP date Processing date Ranges of coverage Exception groups Processing indicator Material data

There is a collective display for the stock/requirements list as well as for the MRP list. In this way, the selection criteria for MRP lists differ from those of the current stock/requirements list. For example, for MRP lists, you have the MRP date, the processing date or even the processing indicator for the selection. For both list types, you can, for example, display all lists for which you are responsible as MRP controller.

The system then displays a material overview with all the materials selected. Traffic lights (you can define the criteria for the display), various search functions in the overview and in the individual lists and sort functions (also for individual customer segments by date or number) are available as orientation help. It is also possible to use the search function to select materials by certain exception messages.

You access the individual lists from the overview and can process the materials there. If, for example, you have selected several lists for processing over the search function, you can jump from one list directly into the next list selected.


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Exception Messages

Date Element EM Quantity ...1.2.2003 PlOrd 50 pc05... Opening date in the past

Newly generated procurement proposal?Dates in the past (start, finish or opening date)?Problems with BOM explosion?Problems with scheduling?Rescheduling situation?

Stock/requirements list - MRP list

Adjustable in Customizing: Priority (maximum of 2 exception messages per element) Assignment to exception groups (select in the MRP lists)

The MRP results are monitored with the help of exception messages. Exception messages alert you to situations that require further processing such as start date in the past, stocks falling below the safety level and so on. Using exception messages to highlight planning situations problems, the MRP controller can select those materials from the planning results that require additional processing.

In the Customizing IMG activity "Define and group together exception messages", you can specify the characteristics of the exception messages.

If there are several exception messages that apply for one MRP element, the priority that has been assigned to these messages decides which messages will be displayed. The system displays a maximum of two exception messages per MRP element.

While not all exception messages will be displayed in the stock/requirements list, in the case of scheduling problems, the system displays both a corresponding exception message in the stock/requirements list as well as in the MRP list. A rescheduling proposal is also displayed. If this proposal is to be accepted, you must adjust the dates for the receipt element manually. The automatic adjustment of these dates is possible in the planning result display or evaluation (for example, in interactive planning or when the indicator "Display result" has been selected in the initial screen of the planning run): The rescheduling proposal can be accepted here using the function "Reschedule order proposal".


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MRP with Lead-Time Scheduling

Scheduling ind. = 2, capacity requirements are calculated

OS OF

Operations (from the routing)

Float before production Safety time

10 3020

OS OF

Production finish date

Productionstart date

1

2

Order startdate

Order finishdate

Planned order

You can set lead time scheduling for the planning run by using the scheduling indicator "2" (lead time scheduling and capacity planning).

During the planning run with the scheduling indicator 2, the order start and order finish date are determined for each basic scheduling. This is then followed by lead time scheduling.

In lead time scheduling, the precise production times (that is, production start and finish dates) are defined for material produced in-house and at the same time the capacity requirements are created. The materials staging date for the components is also determined.

Lead time scheduling is carried out using the times from the routing. This takes place as backward or forward scheduling according to the setting in the Customizing IMG activity "Define scheduling parameters for planned orders". The following times are taken into account: Floats (float before and after production) that are assigned to the material using the scheduling margin

key, Individual times from the routing: Queue time, setup time, labor and machine time.

In backward scheduling, the system first calculates back from the order finish date to determine the float after production, which in turn calculates the production finish date. The individual operations of the routing are scheduled backward starting from the production finish date. The start date of the first operation becomes the production start date.


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MRP and Capacity Planning

Step 1: MRP

Takes place on the basis of "infinite capacities"

Capacity requirements are created for work centers

Step 2: Capacity Planning

Availability of capacities for production dates is checked

Operations are scheduled at their work center

Work center paint shop

Occupied OccupiedOp. 20

Capacity free, scheduling possible

Op. 30Op. 20Op. 10

Planned order Finished product

ReqmtWhen should production take place?

Time

In MRP, capacity requirements that result from planned orders can be calculated using the routing. MRP itself creates the requirements only. A check to ensure whether a work center is still available for the respective dates does not take place first of all (SAP R/3 MRP).

In a second step you should check whether planning can be realized, whether work centers are available for the required dates, therefore. This takes place in Capacity Planning.

As a rule, Capacity Planning is work center-related. The goal of Capacity Planning is to schedule all operations of planned and production orders, so that the production plan can be filled.


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Within the framework of Material Requirements Planning, material availability should be ensured. If material shortages exist, the corresponding procurement elements are produced.

The materials can be produced in-house or procured externally. Stock transfers from other locations are also possible.

For materials that are produced in-house, multilevel requirements planning is executed. The availability of the components that are needed for production is ensured via dependent requirements.

Material Requirements Planning: Unit Summary (1)


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The results of Materials Requirements Planning can be checked and evaluated using the current stock/requirements list and the MRP list. A multitude of functions are available in both lists to process MRP elements.

Subsequent to MRP, capacity planning takes place. This ensures that the work centers required for production are available.

Material Requirements Planning: Unit Summary (2)


6.28Material Requirements Planning Exercises

Unit: Material Requirements PlanningTopic: MRP Run


Execute MRP as single-item, multilevel planning.

Pumps with the material number R-F1## (## represents your group number) are produced in plant 1000. Demand management and material requirements planning for these pumps takes place in SAP R/3.

You have already created planned independent requirements and customer requirements for this material. These requirements should be covered by MRP.

1-1 Firstly, get an overview of the stock/requirements list for the pump:

1-1-1 Access the stock/requirements list for material T-F1## in plant 1000. Requirements (planned independent requirements and customer requirements) and procurement elements should already exist. Are you dealing with a balanced stock/requirements situation? Why (not)?

____________________________________________________

____________________________________________________

1-1-2 20 produced pumps enter the warehouse from production. Post a corresponding goods receipt. (To simplify matters, you should avoid referring to the production order at this stage).

From the inventory management menu, call up the transaction Goods receipt other. In the initial screen, enter the following data:

Movement type: 501 (GI receipt w/o PO)

Plant: 1000

Storage location: 0002

Confirm your entries using Enter and create the following goods receipt element:

Material: R-F1##

Quantity: 20 pc.

Confirm your entries using Enter and post the receipt.


1-1-3 Access the stock/requirements list for material T-F1## in plant 1000 again (or refresh it). What is the available quantity at the end of the list? Why?

_________________________________________________

_________________________________________________

1-2 Use MRP to deal with the new stock/requirements situation. As you want to observe the effects on all materials in the BOM structure, carry out single-item, multilevel planning:

1-2-1 Call up Single-item, multilevel from the MRP menu and enter the following data in the initial screen:

Material: R-F1##

Plant: 1000

Processing key: NETCH

Create MRP list 1

Planning mode 1

Scheduling: 1

Also plan unchanged components: Select

Before you start the planning, save your settings (via Settings Save). Confirm with Enter.

Start MRP by choosing Enter twice.

1-2-2 Call up the current stock/requirements situation (or refresh it). What is the available quantity at the end of the list now?

____________________________________________________

Has a suitable planned order been created for the date of the customer requirement?

____________________________________________________

1-2-3 From the current stock/requirements list change the planned order with the earliest date (select it and choose the Change element icon). The planned order as it appears on the screen contains no production dates (tab page “Header”). From the planned order, you need to thus choose the function Edit Scheduling: The routing is then read and the production dates are calculated and added to the planned order.

Return to the “Header” tab page and fix the order by setting the corresponding indicator. Save the order and refresh the current stock/requirements list.

Had you executed the planning run using scheduling indicator 2 (lead time scheduling), then the planned orders would have already been supplied with detailed scheduling data. You have just explicitly carried out this lead time scheduling step for an order.


Is the planned order now displayed differently in the list?

____________________________________________________

1-2-4 To finally initiate production, convert the fixed planned order from the list into a production order. To do this choose Additional data for element and then Convert planned order into production order. Save the production order, return to the list and refresh it. The production order is then displayed.

Converting a planned order into a production order is the last step in the planning process of Supply Chain Planning. Execution of the order (Printing of order documents, confirmations and so on) then follows.


Exercises


Unit: Material Requirements PlanningTopic: Evaluating planning using the MRP list


Evaluate the planning result using the MRP list

Once you have carried out planning for pump R-F1## and its components, evaluate the planning result using the collective display of MRP lists.

2-1 Starting from the MRP menu, access the MRP list - Collective display.

2-1-1 On the initial screen, select the lists in plant 1000 for MRP controller 0## (leave the remaining selection windows empty). After carrying out the selection using Enter, an overview of the materials that were selected appears.

How many materials were selected?

____________________________________________________

Have exception messages occurs for some of these materials?

____________________________________________________

2-1-2 Check the MRP for finished product R-F1##. Call up this list, by double-clicking on the corresponding line in the material overview, for example. Do exception messages exist for this material?

____________________________________________________

What, for example, does the last exception message displayed in the list mean?

____________________________________________________

2-1-3 In the preceding exercise, you converted the planned order with the earliest date into a production order. However, this production order is not displayed in the MRP list. What is the reason for this?

____________________________________________________

____________________________________________________

2-1-4 Expand the Header details for this MRP list. Proceed to the tab page “Stocks/coverage”. How big is the day’s supply for material R-F1##?

____________________________________________________

What time period is specified?(C) SAP AG SCM200 33

____________________________________________________

2-2 Optional: Exit the collective display of MRP lists, and execute single-item, multilevel planning for material R-F1## in plant 1000 and call up the MRP list for the pump again (in individual display, or collective display as above).

2-2-1 Is the production order displayed now? Why (not)?

____________________________________________________

2-2-2 Expand the Header details for this MRP list again and proceed to the tab page “Stocks/coverage”. How big is the first receipt days’supply for material R-F1##?

____________________________________________________

What time period is specified here? How can you explain the difference to the stock day’s supply?

____________________________________________________

____________________________________________________

____________________________________________________


6.29Material Requirements Planning Solutions

Unit: Material Requirements PlanningTopic: MRP Run

1-1

1-1-1 SAP R/3 menu path: Logistics Production MRP Evaluations Stock/Requirements List

Balanced stock/requirements list? No, the stock/requirements situation is not balanced. In total, the correct quantities are procured, procurement for the sales order (30 pc.) occurs, but, as originally scheduled in planned independent requirements, right at the beginning of the month and thus too early.

1-1-2 SAP R/3 menu path: Logistics Materials Management Inventory Management Goods Movement Goods Receipt Other

1-1-3 Available quantity at the end of the list: At the end of the list (and also for the individual dates in the list) 20 pieces are available. This is the result of the goods receipt.

1-2

1-2-1 Menu path: Logistics Production MRP Planning Single-Item, Multi-Level


Available quantity at the end of the list: At the end of the list, zero pieces are available, the situation is balanced.

Planned order for customer requirement: Yes, a planned order with appropriate dates was created for the customer requirement.

1-2-3 Planned order displayed differently? Yes, the plan is fixed, and thus marked with a star.


Solutions


Unit: Material Requirements PlanningTopic: Evaluating planning using the MRP list

2-1 SAP R/3 menu path: Logistics Production MRP Evaluations Stock/Requirements List

2-1-1 Number of materials selected: Varies. As a rule, 36 materials are selected.

Exception messages: Varies. As a rule, exception messages occur.

2-1-2 Exception messages: Varies. As a rule, exception messages occur for this material.

Last exception message: Varies. Exception message 01 appears as “newly created”.

2-1-3 Production order not displayed: The production order is not yet displayed because it was created after the last planning run. The consequence is that only the result of the last planning can be seen.

2-1-4 Stock days’supply: Varies, for example 28.3 (workdays).

Time period: This specifies how long the requirements can still be covered by the existing stock, in this example 28 days. The decimal places show what amount of the requirement, that leads to shortages, can still be covered (in this example, 30 percent).

2-2

2-2-1 Production order now displayed? The production order is now displayed, because it has been accounted for in the planning run.

2-2-2 1. Receipt days’supply: Varies, for example 48.0 (workdays).

Time period: This specifies how long the requirements can still be covered by existing stock and fixed receipts. The production order thus accounts for the difference here.


7

SAP AG 2002


SAP APO master data

Simultaneous quantity and capacity requirements planning

Planning results in SAP APO and execution in SAP R/3

Optimization

Contents:


(C) SAP AG SCM200 1

7.2

SAP AG 2002

Explain the functions and benefits of PP/DS

Specify which SAP APO master data is used in PP/DS

Explain simultaneous quantity and capacity requirements planning

Display and review planning results in SAP APO

Explain the procedure used to execute planning results


Production Planning and Detailed Scheduling: Unit Objectives

(C) SAP AG SCM200 2

7.3

SAP AG 2002


Demand Planning


Course Overview


Demand Management



Conclusion

(C) SAP AG SCM200 3

7.4

SAP AG 2002

PP/DS Overview


APOAPO

R/3R/3



Scheduling (PP/DS)


Capacity Requirements Planning (CRP)

Standard SOP

SalesDemand Management

CIF


Independent requirements are the starting point for production planning in SAP APO PP/DS: Sales orders are generally created in SAP R/3 and transferred from there to SAP APO for planning. Planned independent requirements can be created in SAP R/3 (demand management). It is also possible, however, to derive them from SAP APO DP.

Stock transfer requirements can be derived from supply network planning within SAP APO SNP, which can then be covered using PP/DS. It is also possible to directly convert SNP planned orders into PP/DS planned orders.

Whereas in SAP R/3, capacity requirements planning is executed separately in a second step, in SAP APO PP/DS, quantities and capacities can be planned simultaneously.

Execution of production, in other words, the processing of manufacturing orders (production or process orders) takes place in the area of Supply Chain Manufacturing. Supply Chain Manufacturing takes place predominantly in SAP R/3.

(C) SAP AG SCM200 4

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SAP AG 2003

Transition from SNP Orders to PP/DS Planned Orders

Planningin SNP

Planning in PP/DS

Create

Today100

Today100

Today

Delete

Create using PP/DS PPM

3010 20

SNP prod. horizon

PP/DShorizon

SNP prod. horizon

Alternative: Copy SNP planned orders directly by converting them into PP/DS orders

PP/DShorizon

Supply Network Planning is used for medium-term to long-term planning across the whole supply chain (especially if several plants and distribution centers are available). As such, requirements for a set bucket (day, for example) are aggregated. When exactly the requirement is accumulated in the respective bucket does not yet play a role. Order sequences do not play a role in SNP either..

In the above example, an order is being created in SNP with the help of the SNP production process model. SNP orders are thus aggregated for each defined bucket. SNP takes place outside of the SNP horizon. PP/DS orders are valid as firmed receipts in SNP and are taken into consideration during planning.

Once the start date of an SNP order enters the PP/DS horizon, it is subject to PP/DS. It is thus deleted in PP/DS planning and replaced by a PP/DS order, which is created based on PP/DS master data.

If SNP orders are to be directly transferred to planning in PP/DS, they must be converted into PP/DS orders in good time, that is, before the PP/DS horizon is reached. To allow you to do this, background conversion is available in the PP/DS menu, which can also be scheduled periodically. As a result of the conversion, the order is created again in PP/DS using the production process model defined there.

The PP/DS horizon specifies a number of days on which PP/DS is used for planning. The PP/DS horizon can be defined in the Customizing for Supply Chain Planning. You may also define a PP/DS horizon, per location, for each of the products in the product master.

(C) SAP AG SCM200 5

7.6

SAP AG 2002

Purposes of PP/DS in SAP APO

Supply Chain

To-the-minute planning of production and external procurement

Capacity Requirements Planning (separately or simultaneously) on operation level in the short-term horizon

Machine Scheduling Optimization

Above all, the purpose of production planning is short-term to-the-minute planning (both for in-house production and external procurement) in the production plant.

In PP/DS, requirements are met by generating planned orders (to plan in-house production) as well as purchase requisitions or scheduling agreement schedule lines (to plan external procurement).

In contrast to mid-term planning in SAP APO SNP, production planning in the plant is detailed and uses exact times. Exact production times for the production of materials are thus determined.

(C) SAP AG SCM200 6

7.7

SAP AG 2003

Benefits of PP/DS in SAP APO

PP/DS with simultaneous Quantity and Capacity Requirements Planning

To-the-minute Material Requirements Planning (hours, minutes) for dependent requirements also

Multilevel material and capacity availability check possible (pegging)

Multilevel ATP check possible Optimization procedures within PP/DS (minimize setup times,

setup costs, scheduling delays, alternative resource selection, ..)

Dynamic exception messages (alerts)Capacity categories: Time, activity, volume, piece

Simultaneous material and capacity requirements planning: You can define resources as finite resources in the resource master. Order operations are only created at these resources if there is sufficient capacity for the order quantity on the corresponding date. If there is not enough capacity available, the system searches for a new date, taking the capacity situation into account.

Automatic planning immediately: If you set this indicator for a product, the system starts a single-level planning run for this product for each change made that is relevant to planning (for example, a new sales order).

Planning with exact times: Dependent requirements and orders are created with a time. Machine Scheduling Optimization: During planning, it may be that orders were generated whose order

sequence is not optimum. Therefore, you can change the sequence and resource assignment of existing orders in the optimization run.

(C) SAP AG SCM200 7

7.8

SAP AG 2002

Usage of PP/DS in SAP APO

Planning critical products (for example, products which have long replenishment lead times or products that are produced on bottleneck resources)

Planning in the short-term horizon, or, where necessary, using simultaneous capacity requirements planning

Optimization of the production plan

Reduced lead times Increased throughput of products based on a better

coordination of resources Reduced stock costs based on more exact production

planning

Not necessarily all the materials of a plant have to be planned in SAP APO. Advanced Planning functions that are available in SAP APO are not necessary for all materials. You would typically plan critical products (that are produced on bottleneck resources, perhaps) in SAP APO.

You should be aware that the choice of materials to be planned in SAP APO has to be defined sensibly: For example, you should plan all products in SAP APO that are planned on certain resources, as sensible capacity requirements planning would not be possible without all materials in SAP APO.

Planning in SAP APO creates a wide range of benefits. By optimizing order sequences, lead times can be reduced, more precise planning enables you to reduce stocks, and, at the same time, you can achieve improved on-time delivery performance, and so on.

(C) SAP AG SCM200 8

7.9

SAP AG 2003

SAP APO PP/DS and SAP R/3 MRP

Incorrect Correct KeyPlanned in SAP APO Planned in SAP R/3

Planning of a BOM structure in SAP APO and SAP R/3

SAP APO PP/DS carries out production planning only; Execution (confirmations, goods receipt and so on) is carried out in SAP R/3

Products that are planned in SAP APO PP/DS should be excluded from planning using a corresponding MRP type in SAP R/3

Planning results are transferred from SAP APO to SAP R/3 for execution If required, planning is completed in R/3 (for example, if all of the products of a BOM structure are not planned in APO).

In principle, production planning/detailed scheduling can be executed in SAP APO PP/DS or in SAP R/3 MRP. Planning in SAP APO offers several functional benfits.

In general, not all materials are planned in SAP APO. Rather, planning in SAP APO is limited to important materials, whereas planning for less critical parts is completed in SAP R/3. Materials that are planned in SAP APO should be excluded from planning using a corresponding MRP type in SAP R/3

(C) SAP AG SCM200 9

7.10

SAP AG 2003

MRP Type "X0"

R/3 R/3Material master D

Material master CMaterial master B

Material master A

Mat. AX0

MRP Type X0MRP Procedure XWithout MRP (in SAP R/3),

with BOM explosion

Mat. BX0

Mat. CX0

Mat. DVB

APO APOProduct C

Product BProduct A

Integration model

Which materials should be planned in SAP APO?

Which master and transaction data should be exchanged?

Planning is not necessarily executed for all materials in SAP APO. Planning for critical materials can take place in SAP APO, while less critical materials (such as consumption-controlled purchasing materials) can be planned in SAP R/3.

Materials that have been planned in SAP APO may not be planned again in SAP R/3 - the planning results from SAP APO are transferred directly to SAP R/3 as planned orders . Nevertheless, dependent requirements must be determined for materials that have a BOM in R/3 (normally as a result of material requirements planning). You assign these materials a special MRP type with the MRP procedure, "X" ("without MRP, with BOM explosion").

It is also possible to use the MRP type XO to select materials relevant for SAP APO in the integration model.

In general, you should be careful about separating SAP APO-relevant materials from those that are not SAP APO-relevant: For effective planning in SAP APO, you must be sure that all materials important for the planning process can actually be planned in SAP APO. (For example, with capacity planning, if the capacities in SAP APO are to be planned for the different resources, all materials whose production uses these resources must be planned in SAP APO.)


7.11

SAP AG 2002

Primary Processes in SAP APO PP/DS

Make-to-stock production

Production planning with finite or infinite capacity requirements planning


Make-to-order production Planning for individual sales orders with finite or infinite capacity requirements planning


CTP scenario possible on single or multilevel

External procurement

CTP scenario possible for sales orders in the PP/DS horizon (Capable-to-Promise)

Source determination

Scheduling agreement processing and subcontracting possible

The production of a product can be planned in make-to-stock production. Various planning strategies are available. The production program is determined in make-to-stock production using planning requirements, and if necessary, using sales orders that already exist.

Requirements can be covered using finite or infinite planning. Different optimization procedures can be used within capacity requirements planning.

Sales orders can also be planned in make-to-stock production within a CTP check. When a sales order is created, an ATP check is carried out to see if the necessary procurement elements exist, and, if necessary, a new procurement element is created and scheduled according to capacity. Possible delays (because of capacity overloads, for example) are directly reported to the sales order. In make-to-stock production, a CTP check is only possible within the PP/DS horizon.

In make-to-order production, each sales order is planned in a separate segment. Planning can be finite or infinite. As the PP/DS horizon plays no role in make-to-order production, the CTP check can be carried out without any time restrictions.

In addition to in-house production, external procurement can be planned in SAP APO. Automatic source determination (based on costs, for example) can also take place. Scheduling agreement processing and subcontracting can also be depicted.


7.12

SAP AG 2002

SAP APO Master Data for In-house Production

APOAPO

R/3R/3

SAP R/3 master data

SAP APO master data

Location

Product


Production version Routing BOM

Resource

Production process model (PPM)

Plant

Customer

Vendor

Material master

In SAP APO, resources and production process models are used to plan in-house production. This data is transferred from SAP R/3 to SAP APO. SAP R/3 work center capacities are mapped onto SAP APO resources and SAP R/3 routings and BOMs are mapped onto a SAP APO production process model.

For routings and BOMs to be transferred from SAP R/3, a corresponding production version must be present in the SAP R/3 material master. The production version determines a manufacturing process by specifying a routing and a bill of material.

In the SAP R/3 material master, several production versions can be defined (for different lot size intervals, for example). Each of these production versions is transferred to SAP APO as an individual PPM.

The PPMs that are transferred from SAP R/3 have usage "P": They can be used in SAP APO for Production Planning and Detailed Scheduling (PP/DS). If the plans are to be used for Supply Network Planning (SNP) as well, they need to be copied as PPMs with usage "S". There is a special report for this available in SAP APO.


7.13

SAP AG 2002

Resources in SAP APO

Single-activity resources (PP/DS) Time-continuous

Available capacity for one activity

Multiactivity resources (PP/DS) Time-continuous Available capacity for multiple

activities

Bucket resources (SNP) Time intervals

Available capacity per time interval

Mixed resources (PP/DS and SNP)

Resources are SAP APO master data, in which capacities and working times of machines, personnel, vehicles and warehouses are defined. They can be created in SAP APO when SAP R/3 work centers are transferred via the CIF.

Resources can be defined as single-activity resources, multi-activity resources or bucket resources. Single- and multi-activity resources can be used for continuous and exact time planning in PP/DS, bucket resources are used for mid- and long-term planning in Supply Network Planning (SNP). The time periods (buckets) for bucket resources are at least one day long.

Mixed resources can be used in both SNP (bucket-oriented scheduling) and in PP/DS (time-continuous scheduling).


7.14

SAP AG 2002

Work Center and Resources

An APO resource for each SAP R/3 work center capacity

Work Center

Capacities

001Capacity cat. Machine

002Capacity cat. Person

1904Plant 1000 Resource

2 multi mixed

W1904_1000_001

Resource Cat. Location

P 1000

W1904_1000_002 P 1000

If necessary, define capacity variants

and shiftsR/3 APO

During the transfer of an SAP R/3 work center to SAP APO, each capacity category is mapped in its own resource. The transfer takes place according to the following naming convention: The name of the work center will start with a "W", then comes the plant from which the work center stems, and then the capacity category comes at the end.

SAP R/3 work center capacities are normally transferred as "production" type multi or single-activity resources. If you want mixed resources, which can be used in PP/DS and SNP (bucket resources) to be created during the transfer using the CIF, then you should use a corresponding customer exit.


7.15

SAP AG 2002

Production Process Model (PPM) (1)

Plan N500077010001APO

PPM Product A Operation 10Assembly

Activity: Setup

Components

Activity: Production

Relationships

Operation 20Checks


Relationships

...

R/3Standard routing Group counter

SAP R/3 prod. version 0001500077 01

The Production Process Model (PPM) in SAP APO contains the information required for manufacturing a product. It represents the combination of routing and bill of material for a master data object.

The plan number in SAP APO is derived from original data during the transfer of an SAP R/3 production version. It is made up of the routing number, group counter and the production version number.

A PPM contains one or more operations. Each operation includes at least one activity. (These activities may be "produce", "setup", "tear down" or "wait"). The components consumed (or produced) by the activity are assigned to the activities. The sequence of activities within the operation is defined by relationships.


7.16

SAP AG 2002

Production Process Model (PPM) (2)

Activities and resources

PPM Product A

Operation 10


Mode 2Primary resource

Secondary resource

W1905_1000_001

W1905_1000_002

Mode 1Primary resource

Secondary resource

W1904_1000_001

W1904_1000_002

Selection of modeis dynamic forscheduling

The resource and the capacity requirement needed to execute an activity are determined by the mode. As well as the primary resource that is relevant for scheduling, one or more secondary resources can also be entered in a mode. The system also determines capacity requirements for secondary resources during scheduling.

Several modes can be assigned to one activity, that is, several alternative resources can be assigned at which the activity can be processed. During scheduling in PP/DS, the system automatically selects a mode. The mode selected is the mode that starts latest if you take the available capacity into consideration.

In optimization in PP/DS, it is possible to give preference to particular modes. The modes can therefore be given different priorities.


7.17

SAP AG 2002

Demand Programs in the Production Plant

Planned independent reqmts

Sales orders

Stock transfer requirements

Demand program

PP/DS in the plantAPO

In-house production External procurement

The demand program that has to be covered by PP/DS in the plant, is determined using planned independent requirements, sales orders and stock transfer requirements.

Planned independent requirements can come from SAP R/3 demand management or from SAP APO DP, sales orders are created in sales (SAP R/3 SD), stock transfer requirements can be derived from SAP APO SNP or from SAP R/3.


7.18

SAP AG 2002

PP/DS Planned Orders

Planned order 4711 (In-house production)Receipts

Pump P-100 10 pc.

Reqmts100-100 Casing

100-300 Shaft

10 pc

10 pc...

Operations0010 Staging0020 Pressing...

What will be produced? When will it be ready?

Which components are needed? For which dates?

Which steps are carried out in production? When are they carried out? On which resources?

Procurement of a product in in-house production is planned using SAP APO planned orders. An SAP APO planned order is usually scheduled using detailed scheduling, that is, it contains all

operation dates. Procurement of necessary components is also planned specifically for each operation. If a strategy that envisages finite planning is used in the planning of a planned order, simultaneous

quantity and capacity requirements planning takes place at planned order level. The availability of the capacities that are needed for production is then guaranteed. During infinite planning, capacity requirements planning takes place in a downstream step.


7.19

SAP AG 2002

Multilevel Backward Scheduling in PP/DS

Time

Finished product

Assembly 1

Availability dateStart date

Operation 10

Requirements date10 20

End date Operation 30

10 3020




10 3020

Assembly 2

Raw mat.1

Raw mat.2

Raw mat.3

If there are not enough stock or receipt quantities to cover a requirement, the production planning run generates a planned order. The PPM is exploded and dependent requirements are created for the assemblies. Planning in the next BOM level takes place in the same way. If there are not enough stock or receipt quantities, planned orders are created here also, which, in turn, can have dependent requirements, and so on.

When the lot size of the planned order has been determined and the PPM has been exploded, the production planning run calculates the dates of the planned orders. The operation times in the PPM, as well as any goods receipt processing times maintained in the product master, are taken into account.

The dependent requirements dates are moved to the dates of operations belonging to the PPM. Purchase orders for materials can thus be operation-specific and made on schedule.

The system starts with material staging according to the assignment of components to operations in the PPM. The dependent requirements date of the BOM components is placed on the production start date of the operations to which they are assigned.


7.20

SAP AG 2002

Possibilities of Production Planning in PP/DS

Finite scheduling Simultaneous quantity and capacity requirements planning: All (finite) resources are checked when a planned order is created. The planned order is only created if capacities are available.

Infinite scheduling Resources are not checked when a planned order is created. A planned order is created even if there is a capacity overload.

Downstream DS heuristics (capacity requirements planning) produce a feasible production plan.

Downstream optimization of the plan is possible.

Final optimization of the plan is possible.

Production planning in SAP APO PP/DS can be executed as finite or infinite planning. The corresponding basic settings are made using the strategy profile in PP/DS Customizing.

When a planned order is created during finite planning, the availability of the capacities and components that are needed for production is checked. Only when sufficient capacity is available can the planned order be created. If no capacity remains for the desired time, the planned order is created later, if necessary, (when capacity is available) and this delay is indicated by a corresponding alert.

A production plan that has been created in finite production planning can be processed in downstream optimization. The goal of this optimization could be the reduction in the number of delays that result from the original planning.

Capacities are not checked in infinite production planning. Planned orders are created with appropriate dates, even when no remaining capacity remains. Capacity requirements planning takes place in a second step using special DS heuristics. During this procedure, planning can also be enhanced by final optimization.


7.21

SAP AG 2002

Simultaneous Quantity and Capacity Requirements Planning

TimeToday

Resource 3 (finite)

Resource 2 (infinite)

Resource 1 (finite)

30

20

30

20

Alert, if necessary

AvailableOccupied

1st loading attemptFinal loading attempt

1010

Operations and resource load according to production process model

(Sales orders, dependent requirements, and so on)

Requirement

10 3020

If a product is not available, the requirement (the sales order or dependent requirement, for example) triggers productionProduction Planning and Detailed Scheduling: If it triggers an order for in-house production, SAP APO creates a planned order for the desired quantity in PP/DS. All operations of the production process model (PPM; SAP APO master data record, which contains the SAP R/3 bill of material and routing) are scheduled at the resources of the PPM and the system takes capacity constraints into account (available capacity and, possibly orders that have already been scheduled).

If a finitely planned resource is already exhausted on the desired date, the system searches for a new date on which the planned order can be created. You use the strategy profile to define how the system is to schedule (search for a slot, infinite planning ...).

A finitely planned resource is defined in the resource master using the indicator “Finite Scheduling". O perations of orders are only created on these resources if there is enough capacity available for the order quantity on the order date.

A strategy profile is maintained in SAP APO Customizing. In the global settings of PP/DS, you define which profile should be used for the scheduling of planned orders. The default strategy profile in the delivery system is SAP002 (search for a slot backward).


7.22

SAP AG 2002

Heuristics Used in Production Planning

SAP_MRP_001 Production planning run according to low-level code

SAP_MRP_002

Possible shortage on component level is displayed using alerts

The procedure is very fast

The production planning run also takes place according to low-level code, but components with "automatic planning immediately" are planned directly

Scheduling delays on component level are propagated to the finished product

Date/time alerts usually occur at finished product level

Production planning runGlobal settingsProcessing step Heuristic

...Selection of products ...

Two main heuristics are available for the production planning run in SAP APO PP/DS: Product Planning (components according to low-level planning) (SAP_MRP_001) and plan components immediately (SAP_MRP_002).

Using the heuristic SAP_MRP_001, products are planned in order of their low-level coding. If a dependent requirement at component level cannot be covered in time, the delayed procurement element is created and provided with an alert. This delay is not automatically passed on to subsequent affected orders.

If infinite planning takes place, the heuristic SAP_MRP_001 process corresponds functionally to the MRP run in SAP R/3 MRP. This process is very fast and is thus particularly suitable for mass applications.

The heuristic SAP_MRP_002 differs from the heuristic SAP_MRP_001 with regards to the components that can be found in the product master under the Automatic planning immediately indicator: These components are planned immediately if a dependent requirement was created for them in the planning of the superior product. If this dependent requirement cannot be covered on time, the superior planned order is also moved and provided with an alert. Date/time alerts typically occur at finished product level with this kind of planning. Forward propagation of delays can also take place at several low-level codes.


7.23

SAP AG 2002

Product View

Evaluating the planning result:O

verv

iew

tree

MRPelements

Elements Product Forecast ...

Product PUMPLocation 1000

Product view PUMP Display and edit individual procurement elements

Quick display of adjoining information (product master, ATP, forecast and so on).

Interactive planning Alerts; Possible to jump

to the alert monitor Adjustable user-

specific settings

The planning situation for a certain location product can be evaluated using the SAP APO product view. The product view is a versatile and flexible tool that you can use to execute a range of functions: You

can display and change individual MRP elements, you can plan interactively, you can jump to the alert monitor and so on.

The top part of the product view contains a header with a product number, on the left (optional) there is an overview tree and in the lower part, the list itself with the individual MRP elements and the corresponding available elements. Further tab pages contain accompanying information. User-specific settings enable you to adjust the display to your personal needs.

The product view is a dynamic list. Interactive planning can be executed, for example, and as soon as you have saved the result, the current situation is then displayed. It is also possible to refresh the list, if, after some time has elapsed, you need to display the current planning status.


7.24

SAP AG 2002

Product Planning Table as a Further Tool

PlannerH.Miller

Shown

Product Planning Table

WT-F00_1000_002WT-M##_1000_002WT-L00_1000_001WT-M##_1000_002

Resource per product -periodic planningProduct view: periodic

Charts

22.06.02 24.06.02 25.06.02 26.06.02 27.06.02 28.06.02 01.07.02 02.07.02Resource View: Periodic

Product view: periodic

Alert Monitor

PlOrd / T-F200 pc.Total requirements/conf. pc.

Available quantity pc. 200- 200- 200- 200- 200- 200- 200- 200-Days' supply Day 9- 12- 13- 14- 15- 16- 19 20FCReq / 20 / PLanning wuth final assemblypc.

T-F200##

WT-L00_1000_001 / Utilization %

Requirement H 1,450 7,000 7,000 7,000 7,000 7,000 7,000 7,000Available H 7,000 7,000 7,000 7,000 7,000 7,000 7,000 7,000

WT-M00_1000_002 / Utilization.. % 24,641 50 50 50

WT-L00_1000_001 / Utilizations....% 20,710 100 100 100 100 100 100 100

Hidden

22.06.02 24.06.02 25.06.02 26.06.02 27.06.02 28.06.02 01.07.02 02.07.02

Product View: Quantity Planning

WT-M##_1000_002WT-M##_1000_002

Product view: Quantity graphic

Navigation tree

Chart selection

Resource View: Periodic

Product view: periodic

The product planning table is a powerful tool, and it can be used to execute and evaluate planning in PP/DS. A range of displayable charts are available. Depending on your choice of charts, the product planning table can be tailored to different tasks.

The navigation tree on the top left edge of the screen displays the workscope of the product planning table. Using the navigation tree, you can define which objects can be seen in the individual views. You can group the navigation tree according to different categories (planner, product group, location, resource, for example).

On the bottom left edge of the screen, you determine which charts (for example, product view: periodic, resource view: periodic, alert monitor, quantity graphic) you want to display. Capacity requirements planning can be executed in the product planning table using corresponding charts.

In the resource view: periodic, the requirement of resources is displayed and their utilization of capacity is shown as a percentage.

In the product view: periodic, products, the order quantities that have to be produced in each bucket as well as detailed information about dates and quantities also appear in addition to resources.


7.25

SAP AG 2003

Optimization Using Setup Times as an Example

Setup times at resource paint shopProd. A B C

A 0 10 20B 30 0 15C 30 25 0

Setup times in minutes

Product A: Product B: Product C:

Objective: To minimize setup times ("objective function")

Time

Operations of products A to C at paint shop according to schedule (starting situation for optimization): Planned orders for A were created first, then for B and C

Requirements timeC B AA

Optimization result (with light weighting of delays)BA Setup

time

Optimization result (without weighting of delays)A CSetup

timeA SetuptimeB

C Setup time

SetuptimeA Setup

time B

C Setuptime A

A

Subsequent to capacity requirements planning, the production plan can be optimized. You can optimize the schedule for single resources based on the sum of the setup times and sum of the setup costs. The system determines sequence dependent setup times and setup costs from the setup matrix (which can only be maintained for single resources).

You can determine the objective of optimization using the objective function. Different objective functions are possible (minimization of costs and delays, for example). In the example depicted above, the objective function is the sum of setup times, where the setup times (or the setup costs) flow from the setup matrix into the objective function: The setup matrix contains the setup time in a time unit of your choice (hours or minutes, for example) while the sytem uses the setup duration in seconds in the objective function. If, for example, you enter a setup duration of 10 minutes in the setup matrix, the system uses the value of 600 (seconds) in the objective function.

Setup costs can also be entered in the setup matrix. Setup costs have no unit. In the objective function, the system directly uses the value that has been entered in the setup matrix.


7.26

SAP AG 2003

Converting Planned Orders in SAP APO

CIF

CIFSAP APO planned orderProduct MasterP-100 Source 1000

Receipt quantity 10 pc

17.12.2002

End

10.12.2002

Start00200010 0030

Conversion indicator

SAP APO prod. orderProduct MasterP-100 Source 1000

Receipt quantity 10 pc

Conversion indicator

SAP R/3 production order

Material P-100 Plant 1000Order quantity 10 pc

17.12.2002

End

10.12.2002

Start00200010 0030

17.12.2002

End

10.12.2002

Start00200010 0030

SAP R/3 execution functions

SAP R/3 planned orderMaterial P-100 Plant 1000Order quantity 10 pc

17.12.2002

End

10.12.2002

Start

Planned orders are used to plan the in-house production of a material. SAP APO planned orders thus already contain all production dates.

SAP APO planned orders can be transferred to SAP R/3. The corresponding SAP R/3 planned orders, however, contain no operation dates, but rather basic dates within which production should take place. Moreover, they contain the dependent requirements, for both SAP APO and non SAP APO components. The procurement of these components can be planned in SAP R/3 based on these dependent requirements.

You need to convert the planned orders from SAP APO into production orders, if production planning is to take place in SAP APO PP/DS. A SAP APO production order differs from a SAP APO planned order by its conversion indicator only. If the conversion indicator has been set in SAP APO, a corresponding SAP R/3 production order is created in SAP R/3. This order assumes the production dates, that have been determined in SAP APO. Moreover, like every SAP R/3 production order, it contains all the functions needed to execute production (printing of order documents, confirmations, and so on).


7.27

SAP AG 2002

Execution of SAP APO Planning in SAP R/3

APOR/3

Conversion

Supply Network Planning (SNP)Production Planning (PP/DS)

Consumption

Deploy-ment


Purchase requisition order Purchase order



Plnd. ind.reqmts

Sales order

Production Planning (PP)

Flexible planning

Plnd. ind.reqmtsDemand

management

Sales orderSales (SD)

Purchasing (MM)

Release, confirmations


Purchase requisition order Purchase order


The mySAP component SAP APO is a planning tool that cannot be used on its own. On the one hand, SAP APO relies on data from SAP R/3 (stocks or sales orders, for example) during planning; on the other hand, the execution of dates and quantities planned in SAP APO takes place in SAP R/3. The planning process in SAP APO therefore is linked to a permanent exchange of data between SAP APO and SAP R/3.

In Supply Network Planning (SNP) you plan for the short- or mid-term horizon for the entire supply chain: You generate stock transport requisitions (for planning and stock transfer) between distribution centers and plants, and can also generate planned orders (for in-house production planning) and purchase requisitions (for external procurement planning) directly in the production plant for the longer term horizon. In Production Planning and Detailed Scheduling however, you usually generate planned orders and purchase requisitions directly in the production plant for the short-term horizon. Transaction data generated in SAP APO is transferred to SAP R/3 for execution via the SAP R/3 APO interface (CIF: Core Interface).

As soon as planned orders and purchase requisitions approach today's date, the collective conversion of planned orders into production orders as well as the conversion of purchase requisitions into purchase orders is triggered. The system can convert stock transport requisitions into stock transport orders in SAP APO Deployment. These documents are also transferred to SAP R/3 for execution. Execution functions such as release, confirmation, material staging, or goods movement for production orders or


purchase orders are performed in SAP R/3. Confirmation and other data is then transferred back to SAP APO from SAP R/3.


7.28

SAP AG 2002

To-the-minute production and procurement planning can be carried out in SAP APO PP/DS. A wide range of other functions, which go beyond the possibilities of SAP R/3 MRP, are available.

Production Planning in SAP APO can be carried out for make-to-stock or make-to-production.

Planning can be finite or infinite. In finite planning, quantity and capacity requirements planning takes place simultaneously.

The production plan can be optimized within capacity requirements planning.

The conversion of planned orders into manufacturing orders takes place in SAP APO.

Production Planning/Detailed Scheduling: Unit Summary


7.29Production Planning/Detailed Scheduling Exercises

Unit: Production Planning and Detailed Scheduling (PP/DS)

Topic: Interactive planning and product viewAt the end of these exercises, you will be able to:

Use the product view

Execute interactive planning from the product view

Pumps with the material number T-F2## (## represents your group number) are planned in SAP APO. After requirements have been planned outside the production horizon, PP/DS should be carried out on the short-term area.

1-1 In the SAP APO product view, look at the planning situation for material T-F2## in plant 1000:

1-1-1 From the PP/DS menu, call up the product view for product T-F2## in plant 1000:

Planning Version: 000

Product: T-F2##

Location: 1000

Confirm current messages using Enter and enter the product view. Current planning elements are displayed on the “Elements” tab page.

1-1-2 You can see the PP/DS horizon in the list. Do requirements exist within this horizon?

____________________________________________________

If yes, where do these requirements come from?

____________________________________________________

Are the requirements covered by receipt elements in the PP/DS horizon?

____________________________________________________

How high is the warehouse stock for the product?

____________________________________________________

1-1-3 You have just ascertained that planned independent requirements exist in the PP/DS horizon. Which requirements strategy do these planned independent requirements belong to? (To answer this question, look at the tab pages “Forecast” and “Product master”.)


____________________________________________________

1-2 In the product view, carry out interactive planning for your product.

1-2-1 Return to the “Elements” tab page and proceed to the Change mode of the product view. If necessary, choose the propagation range SAPALL.

1-2-2 Carry out planning for your product, using the Product heuristic tab. Confirm the dialog box that appears using Enter.

Were new procurement elements created?

____________________________________________________

Note down the number of the first planned order that was newly created:

____________________________________________________

Save the planning.

1-2-3 Refresh the list and look at the number of the first planned order. What is striking?

____________________________________________________

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1-3 A customer orders 2 pumps for the current date + 7 days. Create this order in SAP R/3 in the form of a corresponding customer requirement:

Sales orders cannot be created in the SAP APO System. They are transferred from SAP R/3 to SAP APO via the CIF interface.

1-3-1 From the SAP R/3 Program Planning menu, call up the transaction Create customer requirement. In the initial screen, enter distribution plant 1000 and then confirm this using Enter. In the following entry screen, enter the Desired delivery date as the current date + 7 days. Reconfirm using Enter and create a customer requirements item containing the following data:

Material: T-F2##

Order quantity: 2 pc.

Confirm your entries using Enter and save the sales order.

1-3-2 Refresh the SAP APO product view Is the sales order displayed?

____________________________________________________

1-3-3 Have the planned independent requirements been consumed by the customer requirements quantity? (Look at the “Forecast” tab page).

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1-4 To initiate production, convert the first planned order into a production order.

If PP/DS takes place in SAP APO, planned orders from SAP APO have to be converted into production orders. In SAP APO, a planned order differs from a production order by its conversion indicator only.

1-4-1 Convert the planned order with the earliest date in the product view into a production order. Proceed from the tab page “Elements” to the Change mode, select the first planned order and carry out the function Set conversion indicator: Save the planning.

1-4-2 Refresh the product view until a production order is displayed.

As a production order is being created in the background in SAP R/3, it can take a few moments before you see a production order in the product view.

1-4-3 Proceed to the Current stock/requirements list of the SAP R/3 System: Call up the list from the SAP R/3 MRP menu. In the initial screen enter your material number T-F2## and plant 1000 and then call up the list by choosing Enter.

Is the production order displayed?

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Display the order from the list by selecting it and choosing the Display element function. Proceed to the Operation overview. Have a look at the system status of the individual operations. Have these operations been dispatched within capacity planning?

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7.30Production Planning and Detailed Scheduling Solutions

Unit: Production Planning and Detailed Scheduling (PP/DS)

Topic: Interactive planning and product view

1-1 SAP APO menu path: Production Planning Interactive Production Planning Product View

1-1-1

1-1-2 Requirements present? Yes, requirements exist in the PP/DS horizon.

Reason: The requirements come from the forecast transfer from Demand Planning (FCReq.) Moreover, stock transfer requirements from Supply Network Planning (PreqRel).

Requirements covered in the PP/DS horizon? No, the requirements are not yet covered by receipts in the production horizon. PP/DS planning has not yet taken place.

Warehouse stock: Warehouse stock in location 1000 is zero pieces (warehouse stock is not displayed.

1-1-3 Requirements strategy of the planned independent requirements: The requirements belong to requirements strategy 20, planning with final assembly.

1-2

1-2-1

1-2-2 New procurement elements? Yes, new procurement elements (planned orders) were created.

Number of the first newly-created planned order: Varies, for example 11799.

1-2-3 What is striking? The number of the planned order changes (to 30176, for example). This new number comes from SAP R/3: The planned order was transferred to SAP R/3 in the background, given a number there according to SAP R/3 number ranges, and this number was then transferred back to SAP APO.

1-3

1-3-1 SAP R/3 menu path: Logistics Production Production Planning Demand Management Customer Requirements Create

1-3-2 Customer requirement shown? Yes, the customer requirement is displayed.

1-3-3 Consumption? Yes, consumption takes place.


1-4

1-4-1

1-4-2


Production order displayed? Yes, the customer requirement is displayed.

Receipts planned according to capacity? Yes, the receipts are planned according to capacity (Status DSPT).


8

SAP AG 2002

Conclusion

Demand Planning


Course Overview


Demand Management



Conclusion

(C) SAP AG SCM200 1

8.2

SAP AG 2002

Course Summary

You are now able to:

Describe the role of the mySAP components R/3 and APO in Supply Chain Planning

Specify which master data and transaction data is used in Supply Chain Planning

Explain the integration of SAP R/3 and SAP APO

Carry out fundamental planning functions: Demand Planning, Demand Management, Supply Network Planning, Material Requirements Planning.

(C) SAP AG SCM200 2

8.3

SAP AG 2002

Recommended Follow-Up Courses

SCM220 Demand Planning

SCM230 Supply Network Planning

SCM240 Production Planning Part 1

SCM242 Production Planning Part 2 (SAP APO PP/DS)

SCM244 Production Planning Part 2 (SAP R/3 MRP)

In terms of content, the following overview course follows on directly from this overview course:

SCM300 Overview Supply Chain Manufacturing

Follow-up courses in Supply Chain Planning are:

(C) SAP AG SCM200 3

8.4

SAP AG 2002

Recommended Follow-Up Activities

Go through the exercises using IDES data or your own data

Read online documentation

Read IMG documentation

Read release notes

(C) SAP AG SCM200 4

plm150-engineeringchangeandconfigurationmanagement

Documents