SAP PP

Presenter: Sashi Sekhar Paramanik Date: 18-Feb-2013 Version: 1.0

Production planning & execution
 What are the components of Production planning & execution?  Sales information system: Information contains total sales orders already obtained, incoming sales orders, pending sales orders – product wise, customer wise and region wise.  Forecasting: Based on past consumption history, future sales projections are made using statistical forecasting methods.  CO/PA: Projections are based on Costing and profitability analysis.  Sales and Operations planning: Overall plan at company level is done for a year/half-year/quarter.  Demand management: Requirements may come from sales forecast, sales orders, etc.

 Purpose: Use this planning strategy when the main valueadded process is final assembly in a make-to-order environment.  It is possible to use information from the Sales Information System. This is basis for Availability check.  Procurement of the components is planned by means of planned independent requirements (Indreq) entered at the finished product level. Final assembly is triggered once a sales order (Order) has been entered.Planning w/o final assembly  Explain process flow and purpose behind planning without final assembly. .  Production is carried out up to one level before the finished product level. SOP. or other planning tools to plan production quantities.

the unconvertible planned order quantity is increased.  Planned independent requirement of the finished goods quantities that are left unconsumed increase the warehouse stock of the components and cause procurement to be decreased or not to take place at all in the next period. and this in turn reduces the unconvertible planned order quantity. This process is called netting. . If the sales order quantity exceeds the planned independent requirements quantity.Planning w/o final assembly  The incoming sales order consumes the planned independent requirements.

. Procurement for components takes place. During Demand management stage. Available quantity = 300 Stage 2: Procurement before Sales: Non-convertible planned orders are created for finished product. Planning w/o assembly is done. Available quantity = 100<reqdat2> Indreq quantity = 100-. Available quantity = 200<reqdat3> Indreq quantity = 100-. <reqdat2> and <reqdat3>.Planning w/o final assembly  Sample scenario: 100 pieces are planned for <reqdat1>. <today> Stock quantity = 0. Planned requirements are created for production plan and passed on to MRP. <reqdat1> Indreq quantity = 100-.

Available quantity = 90 . Available quantity = 190 <reqdat2> Indreq quantity = 100-.Planning w/o final assembly  Stage 3: Sales order and allocation: A sales order is created for parent material. <reqdat1> Plord quantity = 100. Customer stock (Cstock) = 0 <today> Order quantity = 90-. Available quantity = 190 <reqdat3> Indreq quantity = 100-. Available quantity = 90<today> Planning w/o assembly is done. <today> Stock quantity = 0. Available quantity = 90 <reqdat2> Plord quantity = 100. Available quantity = 90 <reqdat3> Plord quantity = 100. Available quantity = 100 <reqdat1> Indreq quantity = 10-. but is based on planned independent requirements. Availability check is not done as per ATP logic.

Available quantity = 0 Good receipt from production results in Cstock = 90 above.Planning w/o final assembly  Stage 4: Procurement after Sales: Sales order is linked to planned order and to production order (where applicable). Customer stock (Cstock) = 0 <today> Order quantity = 90-. Available quantity = 0 <reqdat2> Plord quantity = 100. Available quantity = 10 <reqdat1> Indreq quantity = 10-. <today> Stock quantity = 0. Available quantity = 90<today> Plord quantity = 90. <reqdat1> Plord quantity = 10. Available quantity = 0 <reqdat3> Plord quantity = 100. . Available quantity = 100 <reqdat2> Indreq quantity = 100-. Available quantity = 0 <today> Planning w/o assembly is done. Available quantity = 100 <reqdat3> Indreq quantity = 100-.  Stage 5: Goods issue for Delivery: Planned independent requirements are physically reduced.

Planning w/o final assembly .

You can react quickly to customer needs.  Purpose: Use this planning strategy when you can forecast production quantity for final product in make-to-stock environment.  An accurate availability check is done as per ATP (available to promise) logic during sales order processing.Planning with final assembly  Explain process flow and purpose behind planning with final assembly.  Planned independent requirements are consumed by incoming sales orders so that master plan is always adjusted to suit current requirements. .  Planned independent requirements are entered at finished product level and trigger procurement and production of necessary assemblies and components before receipt of sales orders. smoothing of master plan is less important.

<reqdat2> and <reqdat3>. Planning w/o assembly is done. <reqdat1> Indreq quantity = 100-. Available quantity = 100<reqdat2> Indreq quantity = 100-. Available quantity = 300 Stage 2: Procurement before Sales: A procurement requisition is created in MRP run and is starting point for production or procurement. release of production order and goods receipt of yield quantity. . <today> Stock quantity = 0. One procurement option is to convert planned order into production order.Planning with final assembly  Sample scenario: 100 pieces are planned for <reqdat1>. Planned requirements are created for production plan and passed on to MRP. The other option is to use returns or other goods movements for make-to-stock production. During Demand management stage. Available quantity = 200<reqdat3> Indreq quantity = 100-.

Available quantity = 100 <reqdat2> Indreq quantity = 100-. Available quantity = 0 <reqdat2> Plord quantity = 100. Available quantity = 100 <reqdat3> Indreq quantity = 100-. <reqdat1> Plord quantity = 100. Available quantity = 0 <reqdat3> Plord quantity = 100. Available quantity = 0 <reqdat2> Plord quantity = 100. Available quantity = 100 <reqdat3> Indreq quantity = 100-. <today> Stock quantity = 100. Available quantity = 100 <reqdat2> Indreq quantity = 100-. situation appears as below. <reqdat1> Indreq quantity = 100-. Available quantity = 100 <reqdat1> Indreq quantity = 100-. Available quantity = 0 <reqdat3> Plord quantity = 100.Planning with final assembly <today> Stock quantity = 0. Available quantity = 0 After receipt of order and 2nd MRP run. Available quantity = 0 .

Available quantity = 100 <reqdat2> Indreq quantity = 100-. Available quantity = 0  Stage 4: This stage does not. Available quantity = 10 <reqdat1> Indreq quantity = 10-. Availability check is done as per ATP logic. Available quantity = 0 <reqdat2> Plord quantity = 100. <today> Stock quantity = 100. Available quantity = 0 <reqdat3> Plord quantity = 100. apply here. there may be need for production to take place after sales. Available quantity = 100 <reqdat3> Indreq quantity = 100-. If demand exceeds planning.Planning with final assembly  Stage 3: Sales order: A sales order is created. as a rule. <today> Order quantity = 90-. .

<today> Stock quantity = 10. Available quantity = 0 Reduction of independent requirements is invisible now. Available quantity = 0 <reqdat2> Plord quantity = 100. . <reqdat1> Indreq quantity = 10-. following situation appears. Available quantity = 100 <reqdat2> Indreq quantity = 100-. Available quantity = 100 <reqdat3> Indreq quantity = 100-. because planned independent requirement was allocated during sales order processing. Available quantity = 0 <reqdat3> Plord quantity = 100.Planning with final assembly  Stage 5: Goods issue for delivery: After delivery and goods issue.

Planning with final assembly .

These material components must be provided for use at the work center. This can be done if no confirmation is entered for operations. .  Operation confirmation allows you to confirm an order step by step. Once an order is confirmed.  When an operation is confirmed. a quantity notification can be auto generated. If a scrap or rework quantity is confirmed. an automatic goods receipt is posted. as in case of time ticket or milestone confirmation. an automatic goods issue is posted on basis of quantity that has been assigned material components (backflush).  Capacity reduction is carried out either in proportion to quantity or activity.Operation/Order confirmations  What is difference between an operation-related and orderrelated confirmation?  Order confirmation is done for entire order at header level. When you confirm last operation. then confirmed quantity and actual costs are written to production order.

 Routing defines production rate (quantity per time unit) used to produce materials on production lines. Production quantity is scheduled and capacity requirement is calculated accordingly. .Repetitive manufacturing  Consider a product scenario where there is high product stability. you set Repetitive Mfg indicator in material master (in MRP view). What type of manufacturing do you suggest?  To allow material to be used in repetitive manufacturing. high repetition rates and low product complexity.

. vendor or warehouse. replenishment is initiated.  Demand source can use material from other containers until actual container returns to full. The supply source can be a production place. How do you process material flow to work centers in event-driven manner?  In KANBAN. Each contains quantity of material that work center personnel needs for a time period. reduced stock and short lead time.  When container is empty.KANBAN  Your company follows relatively constant consumption of materials. material flow is organized using containers kept at appropriate work centers.  Benefits: no staging plan.

Regenerative and Net change plan  What is difference between regenerative planning and net change planning?  Regenerative planning means you plan all materials from planning file.  Net change planning means that you can only plan materials for which planning file exists. This implies that they have undergone change relevant to MRP within a plan horizon. .  Plan is prepared online or as background job.

.  The report consists of shift notes. This is useful for shift transfer. maintenance notifications and graphical evaluations. confirmations (including activity confirm and goods movement).Shift report  Which report collects all important information about work centers for a shift?  The shift report is generated manually by production scheduler once data capture for preceding shift is complete.

(b) unfinished products (WIP) as per status of operations confirmed and (c) variances (such as scrap).  All control functions (process cost allocation.  Current costs for a period comprise values for (a) material quantities delivered for the period as per valuation control of goods receipt. Individual production orders do not have cost segments or settlement rules. All PP and MM functions relevant to costs (material withdrawal.Cost settlement  What is settlement in product cost controller based on?  All costs are debited and credited to a product cost controller. settlement) are carried out at the end of the period on the basis of product costs collector. confirmation. goods receipt for production order and goods receipt from production) are executed on basis of production order. . WIP and variance calculation. overhead allocation.

Cost settlement .

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