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Module : PP (Production

Planning)

Organizational Elements

The SAP PP business processes uses the following organizational
elements:

– Client
– Company Code
– Plant
– Storage Location

Organizational Elements
Client

A Highest Hierarchical Level in SAP (e.g. a corporation)

Used to Differentiate between a Development, Quality Assurance, and
Production System within SAP R/3

Common Set of Rules
 Common Tables
 Common Master Files
 Common Data Bases

Standardized data across the client
 A vendor number and name is common across the client
 A customer is common across the client
 A material number and description is common across the client

a company within a corporate group. required by law. can be created at the company code level. Company Code **** BALANCING / (LEGAL) ENTITY Assets Liabilities Revenues = .Expenses Profit/Loss .  Balance sheets and profit & loss statements. for example.Organizational Elements Company Code  A company code represents an independent balancing/legal accounting entity.

Organizational Elements Plant  Usually a manufacturing facility. manages. and valuates inventory  May be a physical site with multiple manufacturing/production lines  May be multiple manufacturing/production lines at one physical site  Can be a physical location (cost centers may or may not be associated to a plant i. Administrative vs. materials management (MM). and sales and distribution (SD)  A plant is assigned to a company code  Purchasing organization are assigned to plants. . Manufacturing cost centers)  Links to production (PP). or a location that stocks .e. a warehouse.

 Storage locations are always created for a plant. .  Stocks are managed only on a quantity basis and not on a value basis at storage location level.Organizational Elements Storage Locations A storage location is the place where stock is physically kept within a plant A storage location has the following attributes:  There may be one or more storage locations within a plant.  Physical inventories are carried out at storage location level.

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Master Data List of Master Data in SAP PP Module are: – Material Master – Bills Of Material – Work Centers – Routings .

Master Data Material Master .

Material Master .

Materials Planning. Inventory Management. Every area. . It is used by all components in the R/3 Logistics System. such as Purchasing. and Invoice Verification can use the data stored. The integration of all material data in a single database object prevents the problem of data redundancy.Material Master Material master record is a company's main source of material-specific data.

Material Master Since materials are processed by various user departments within a company and each department stores different information for the materials. . Each user department has a different view of the material master record and is responsible for maintaining the data to support its function. the material master is subdivided into information grouped by user departments. The data maintained within a view may be valid for more than one organizational level.

Material Master .

Material Master .

Material Master .

Material Master .

Material Master .

Material Master .

Material Master – Units of Measure Base unit: Piece 16 72 4 Box Crate Pallet (unit of issue) (order unit) (sales unit) .

Material Master .

Material Master .

Master Data Bills Of Material .

Bills Of Material .

Bills Of Material .

Bills Of Material .

Bills Of Material .

Bills Of Material .

Bills Of Material .

Bills Of Material .

Bills Of Material .

Bills Of Material .

Bills Of Material .

Bills Of Material .

Bills Of Material .

Bills Of Material .

Bills Of Material .

Bills Of Material .

Bills Of Material .

Master Data Work Centers .

Work Center .

Work Center .

Work Center .

Work Center .

Work Center .

Work Center .

Work Center .

Work Center .

Work Center .

Work Center .

Work Center .

Work Center .

Work Center .

Work Center .

Work Center .

Work Center .

Work Center

Work Center

Master Data
Routings

Routing .

Components .Routings .

Routing .Components R o u tin g s R o u tin g s c o n ta in :  T h e s te p s re q u ire d to p ro d u c e o r m a k e a n a s s e m b ly  T h e w o rk c e n te rs w h e re th e s te p s a re to b e p e rfo rm e d  T h e re s o u rc e s a n d to o ls n e c e s s a ry to c o m p le te a s te p a t a w o rk c e n te r  M a te ria l a llo c a tio n  T h e m a te ria l b e in g m a n u fa c tu re d is a llo c a te d to th e g ro u p c o u n te r (h e a d e r)  C o m p o n e n t m a te ria ls a re a llo c a te d to o p e ra tio n s  S ta n d a rd v a lu e s fo r s e tu p . a n d te a r-d o w n tim e  In s tru c tio n s o f w h a t to d o a t e a c h w o rk s te p  S k ills re q u ire d to d o e a c h s te p in th e a s s e m b ly p ro c e s s R  S A P A G 0 6 /2 3 /9 7 . p ro c e s s in g .

Routings R o u tin g s  A m a te ria l c a n b e m a n u fa c tu re d in d iffe re n t w ays. y o u c a n c re a te s e v e ra l ro u tin g s fo r d iffe re n t  L o t s iz e ra n g e s  W o rk c e n te rs  U s a g e s .  F o r e a c h m a te ria l. in c lu d in g  P ro d u c tio n  R e w o rk  P ro to ty p e R .

 E a c h in d iv id u a l ro u tin g is re fe rre d to a s a g ro u p c o u n te r w ith in th e g ro u p R o u tin g G ro u p G ro u p G ro u p G ro u p G ro u p C o u n te r 0 1 C o u n te r 0 2 C o u n te r 0 3 C o u n te r 0 4 R  S A P A G 0 6 /2 3 /9 7 .Group R o u tin g s  R o u tin g s a re s to re d in g ro u p s o f s im ila r o r re la te d ro u tin g s .Routing .

Group .Routing .

20 Ite m 2 0 O p.Material Allocation M a te ria l A llo c a tio n B A M a te ria l M a te ria l BOM R o u tin g BOM Ite m 1 0 O p. 10 Ite m 1 0 Ite m 2 0 O p. 30 Ite m 3 0  SAP AG .

PRT Assignments P ro d u c tio n R e s o u rc e /T o o l A s s ig n m e n ts R o u tin g O p e ra tio n 1 0 PRT 1 O p e ra tio n 2 0 PRT 2 O p e ra tio n 3 0  SAP AG .

0002 0000 0001 20 O p e ra tio n 1 0 10 25 O p e ra tio n 2 0 15 30 O p e ra tio n 3 0 20 O p e ra tio n 4 0 25 O p e ra tio n 5 0 30 . M a in s e q u e n c e A lte rn a tiv e s e q .Sequences in Routing S e q u e n c e s in R o u tin g A lte rn a tiv e s e q .

Parallel Sequences P a ra lle l S e q u e n c e s 20 25 30 O p e ra tio n 10 20 30 40 20 30  SAP AG .

Scheduling in PP S c h e d u lin g in P ro d u c tio n P la n n in g M a te ria l R e q u ir e m e n ts P la n n in g  S e p a ra te s c h e d u lin g o f p la n n e d o r d e r s  E x a c t to th e d a y t  B a s ic d a te s c a lc u la te d P la n n e d s ta rt d a te P er io d s P la n n e d d e liv e r y d a te C re a tio n d a te  U s e s lo t-d e p e n d e n t/lo t-in d e p e n d e n t in -h o u s e p r o d u c tio n o r re p le n is h m e n t le a d tim e  O p tio n a lly u s e b a s ic p la n n in g d a y s fro m th e m a te r ia l m a s te r to im p ro v e p e rfo rm a n c e  O p tio n a l c a lc u la tio n o f c a p a c ity re q u ire m e n ts P r o d u c tio n o r d e r m a n a g e m e n t O rd e r h e a d e r o p er at io n s  L e a d tim e s c h e d u lin g  E x a c t to th e s e c o n d m a te ria l c om po n e n ts  B a s e d o n b a s ic d a te M RP M an u al P RT s  T a rg e t d a te s c a lc u la te d (s c h e d u le d d a te s ) c o st s p la n n ed t arg e t a ct u al 100 20 50 T a rg e t s ta rt d a te T a rg e t fin is h d a te  O p e r a tio n s p e c ific d a ta u s e d to c a lc u la te o rd e r d a te s  C a p a c ity r e q u ire m e n ts c a lc u la te d  SAP AG .

O p e r. F loa t a fte r GR P ic k /p a c k L o a d in g T ra n s it p ro d u c tio n 0 0 1 0 0 0 2 0 0 0 3 0 0 0 4 0 0099 p ro d u c tio n p ro c e s s in g BS SS SF BF AD LT GI DDD Q u e ue S e tu p P ro c e s s in g T e a rd o w n W a it M ov e ES LS EF LF O rd e r d a te s O p e ra tio n d a te s T im e te rm s BS B a s ic s ta rt d a te ES E a rlie s t s tart d a te L e a d tim e o rd e r o r SS S c h e d u le d s ta rt d a te (p ro d u c tio n s ta rt d a te ) LS L a tes t s ta rt d a te o p e ra tio n SF S c h e d u le d fin is h d a te EF E a rlie s t s tart d a te F loa t tim e s o rd e r BF B a s ic fin is h d a te LF L a tes t fin is h d a te E x e c u tio n tim e o p e ra tio n AD A v a ila b ility d a te (e x p e c ted ) LT L o a d in g tim e In te ro p e ra tio n tim e s GI G o o ds is s u e P ro c e s s in g tim e s in DDD D e s ire d d e liv e ry da te S a le s a n d D is trib u tio n  SAP AG . O p e r... O p e r. O p e r.... O p e r.. .. Scheduling S c h e d u lin g : T im e E le m e n ts in a n O rd e r F loa t b e f.

Sub Operations in Routing S u b -o p e ra tio n O p e ra tio n 1 0 S u b -o p 1 0 /1 0 S e tu p S u b -o p 1 0 /2 0 P ro c e s s in g 1 S u b -o p 1 0 /3 0 P ro c e s s in g 2 O p e ra tio n 2 0  SAP AG .

Scheduling S c h e d u lin g S u b -o p e ra tio n s 10 20 30 BS SS SF BF Q ueue E x e c u tio n W a it M ove TS 2 0 /1 0 F in is h re fe re n c e 2 0 /2 0 to o ffs e t S ta rt re fe re n c e F in is h re fe re n c e to o ffs e t 2 0 /3 0 S ta rt re fe re n c e to o ffs e t .

Production Planning
• Demand Management
• Material Requirement Planning
− Planning of Purchased parts
− Planning of in house assemblies

Planning Process: Process flow
Central marketing office

Demand (Weekly)

Dispatch plan
Demand planning cell

Production Requirement (Week wise, Model wise)

Planned Prod.
Confirmed PPC MRP Run
Vendor
Schedule Planned Vendor Schedule

Vendor
Web site
Dispatch sheet
Confirmed Production Production

Third Party Log

Planning Process: Strategies

While doing planning, you need to decide which planning strategy to use when the customer
places their order.
• Make-to-Stock Production
− Make-to-stock production means we build stock in anticipation of customer demand. We ship
the customer order from our stock of finished goods

• Make-to-order Production
− We wait for a customer order before we start production/procurement. i.e. We produce as per
demand from customer

Planning process: Demand Planning Dealer Dealer Dealer Dealer Dealer Dealer Territory office Territory office Area Office Area Office Area Office Area Office Zonal Consolidation of Demand Central Marketing office PPC .

Input for the demand program can come from several sources: .Planning Process: Demand Management Demand management is the link between top-level requirements planning (SOP) and materials planning (MRP).

Materials Requirement Planning M R P P ro c e d u re s : O v e rv ie w M a te ria ls P la n n in g P ro c e d u re s MRP C o n s u m p tio n -b a s e d p la n n in g F o re c a s t-b a s e d R e o rd e r p o in t T im e -p h a s e d p la n n in g p la n n in g p la n n in g R  SAP AG .

MRP Overview .

th e d e p e n d e n t re q u ire m e n ts o f th e c o m p o n e n ts a re d e te rm in e d d u rin g B O M e x p lo s io n .  F o r m a te ria ls p ro d u c e d in -h o u s e . R  S A P A G 0 6 /2 3 /9 7 .Uses of MRP M R P U ses  M a te ria l re q u ire m e n ts p la n n in g is u s e d to p la n th e o n tim e p ro d u c tio n o r p ro c u re m e n t o f th e re q u ire d q u a n titie s fo r b o th in te rn a l c o n s u m p tio n a n d c u s to m e r dem and.  T h is p ro c e s s in v o lv e s m o n ito rin g s to c k le v e ls a n d a u to m a tic a lly c re a tin g o rd e r p ro p o s a ls fo r p u rc h a s in g a n d p ro d u c tio n .

and long-term) and regenerative planning  MRP and consumption-based planning  Various lot-sizing procedures  Single-item or collective planning  Processing and rescheduling proposals  Easy-to-use options for evaluating the planning result  Single and multi-level pegging  Planning at multi-plant level R  SAP AG 06/23/97 .MRP Functions MRP Functions Material requirements planning (MRP) consists of the following important functions:  Net change planning (short.

MRP Prerequisites .

Planning Run .

S in g le -L e v e l P la n n in g P la n n in g a s in g le m a te ria l o n e le v e l In te ra c tiv e P la n n in g S to p p in g th e M R P ru n p e rio d ic a lly to m a k e c h a n g e s R  S A P A G 06/2 3/97 .Types P la n n in g R u n T y p e o f P la n n in g W h a t is it? Run T o ta l P la n n in g P la n n in g a ll m a te ria ls fo r a s p e c ifie d p la n t S in g le -ite m . M u lti-le v e l P la n n in g P la n n in g a c o m p le te B O M s tru c tu re fo r a s in g le m a te ria l S in g le -ite m .Planning Run .

R  S A P A G 0 6 /2 3 /9 7 . M R P is ca rrie d o u t o n ly w ith in a d e fin e d p la n n in g h o rizo n .  T h e n e t ch a n g e p la n n in g p ro ce d u re p la n s o n ly th o se M R P ite m s th a t h a ve ch a n g e d re le va n t to p la n n in g sin ce th e la st M R P ru n .Control Parameters C o n tro l P a ra m e te rs fo r M R P  P la n n in g ru n c a n b e c a rried o u t a t tw o d iffe re n t le v e ls :  S in g le -ite m p la n n in g fo r a n in d ivid u a l m a te ria l  T o ta l p la n n in g fo r a ll m a te ria ls in a p la n t  P la n n in g R u n T yp e s  D u rin g re g e n e ra tive p la n n in g .  In n e t ch a n g e p la n n in g in th e p la n n in g h o rizo n .MRP . a ll M R P ite m s a re p la n n e d fo r a p la n t.

Net Change Planning .

Planning in Planning Horizon P la n n in g in th e P la n n in g H o riz o n NNeett cchhaannggee ppla lannnnin ingg P la n n in g h o riz o n in in th thee pplalannnnin ingg hhooriz rizoonn:: mmaateteria riall is is ppla lannnneedd T im e Tod ay NNeett cchhaannggee ppla lannnniningg inin th e p la n n in g h o riz o th e p la n n in g h o riz o n : n : P la n n in g h o riz o n mmaateteria riall is is nnoott ppla lannnneedd !!! T im e Tod ay R  SAP AG .

s in g le -le v e l p la n n in g .p o s s ib ility o f c h a n g in g th e m a s te r p la n m a n u a lly + c re a te + d e le te + change + re s c h e d u le R  SAP AG .Planning Run .p o s s ib ility o f c h a n g in g th e m a s te r p la n fo r e a c h m a te ria l in th e b ill o f m a te ria l m a n u a lly S in g le -ite m .Single Item E x e c u tin g th e P la n n in g R u n fo r S in g le Ite m s S in g le -ite m .p la n n in g a B O M s tru c tu re . m u lti-le v e l p la n n in g .

M u lti-L e v e l P la n n in g F in is h e d p ro d u c t A s s e m b ly 1 A s s e m b ly 2 C om ponent 1 C om ponent 2 P ro c e s s E x e c u te p la n n in g re s u lts p la n n in g ru n M a te ria ls o v e rv ie w S e le c t m a te ria ls A id s : . Multi-Level Planning S in g le -Ite m .s e a rc h o p tio n s E x e c u te .Single-item.in o v e rv ie w p la n n in g ru n R .in in d iv id u a l lis ts  SAP AG .s o rtin g o p tio n s .

Single-Level MRP .

 T h e p ro c e s s fo r m u lti-le v e l p la n n in g is th e s a m e a s fo r s in g le - le v e l e x c e p t th a t it c o n tin u e s fo r e a c h le v e l in th e B O M s tru c tu re . R  S A P A G 0 6 /2 3 /9 7 .Multi-Level MRP M u lti-L e v e l M R P D ependent M o to rc y c le R e q u ire m e n ts fro m M P S ru n MRP A ll le v e ls P la n n e d re c e iv e P o w e r T ra in C h a s s is = D ependent d ep en dent O rd e r R e q u ire m e n ts re q u ire m e n ts fro m M R P ru n fro m th e u p p e r le v e l a n d th e n p la n o rd e rs to s a tis fy th o s e F ro n t R ear B ra k e P la n n e d O rd e r re q u ire m e n ts M o to r G ear Exhaust F ra m e o r P u rc h a s e W heel W heel S y s te m R e q u is itio n  M u lti-le v e l p la n n in g p la n s a c o m p le te B O M s tru c tu re .

Total Planning C a rry in g O u t T o ta l P la n n in g PPla lannnnin ingg ty typpeess:: PPla lannnnin ingg aallll th thee m maate teria rials ls in in aa ppaartic rticuula larr ppla lannt. y o u c a n p la n a ll th e m a te ria ls in a p a rtic u la r p la n t (re g e n e ra tiv e ) o r p la n th e m a te ria ls th a t h a v e u n d e rg o n e a c h a n g e re le v a n t to re q u ire m e n ts p la n n in g s in c e th e la s t p la n n in g ru n (n e t c h a n g e ).t.  W h e n p la n n in g w ith in th e p la n n in g h o riz o n . o n ly th o s e m a te ria ls th a t h a v e c h a n g e d re le v a n t to p la n n in g in th e n e a r te rm a re in c lu d e d . R  S A P A G 0 6 /2 3 /9 7 . oorr P la n t PPla lannnniningg aallll th thee mmaateteria rialsls wwhhicichh hhaavvee uunnddeer-r- ggoonnee aa cchhaannggee re rele levvaanntt to to ppla lannnnin ingg (n (neett cchhaannggee ppla lannnnin ingg)) P la n n e d re c e ip ts P la n n in g in te rv a l: U n lim ite d o r P la n n in g T im e h o riz o n P la n n in g in th e p la n n in g h o riz o n R e q m ts  In th e to ta l p la n n in g p ro c e d u re .

w ith p la n n e d in d e p e n d e n t re q u ire m e n ts . R  S A P A G 0 6 /2 3 /9 7 . a n d in c o m in g s a le s o rd e rs . th e s y s te m c re a te s a n o rd e r p ro p o s a l.MRP Procedure A b o u t th e M R P P ro c e d u re  D u rin g th e n e t re q u ire m e n ts c a lc u la tio n in M R P . d e liv e ry a n d re le a s e d a te s a re d e te rm in e d fo r m a te ria ls p ro c u re d e x te rn a lly )..  T h e s y s te m c a lc u la te s th e q u a n tity re c o rd e d in th e o rd e r p ro p o s a l a c c o rd in g to th e lo t-s iz in g p ro c e d u re y o u s p e c ifie d in th e m a te ria l m a s te r. If a v a ila b le s to c k is le s s th a n th e q u a n tity re q u ire d .e . T h e o rd e r p ro p o s a l is a ls o s c h e d u le d (i. m a te ria l re s e rv a tio n s . th e S A P R /3 S y s te m c o m p a re s a v a ila b le w a re h o u s e s to c k o r th e s c h e d u le d re c e ip ts fro m p u rc h a s in g a n d p ro d u c tio n .

M u lti-L e v e l M R P M MRRPP -. OOnnlyly th thoossee mmaateteria rials ls ththaatt hhaavvee cchhaannggeedd rerele levvaanntt to to MMRRPP aare re re re-p -pla lannnneedd. MMRRPP is is ppeerfo rm e d th ro u g h o u t th e e n tire p la n n in rfo rm e d th ro u g h o u t th e e n tire p la n n in g hoorizg h rizoonn..MRP Control Parameters S in g le -Ite m .SSin inggle le-Ite -Item m... R  S A P A G 0 6 /2 3 /9 7 .. M Muulti-L lti-Leevveell UUssin ingg NNeett cchhaannggee fo forr totota tall hhooriz rizoonn.

MRP Control Parameters S in g le -Ite m ...SSin inggle le-Ite -Item m. R  S A P A G 0 6 /2 3 /9 7 . M u lti-L e v e l M R P M MRRPP -. M Muulti-L lti-Leevveell TThhee DDeelivliveery ry sscchheedduulele ccoonntro troll ppaara rammeete terr ddeete term rminineess ifif sscchheedduulin g lin e s w ill b e c re a te d fo r th o s e p u rc h a s lin g lin e s w ill b e c re a te d fo r th o s e p u rc h a seedd m maate teria rials ls th thaatt hhaavvee aacctiv tivee sscchheedduulin lingg aaggrereeemmeennts ts in in th thee ssyysste temm.

SSin inggle le-Ite -Item m. M u lti-L e v e l M R P M MRRPP -. R  SAP AG 0 6 /2 3 /9 7 .MRP Control Parameters S in g le -Ite m ... M Muulti-L lti-Leevveell TThhee CCre reaatete M MRRPP lis listt ccoonntro troll ppaara rammeete terr ddeessigignnaate tess ifif th thee MMRRPP lis listt wwill ill bbee ccre reaatetedd aass aa re ressuultlt ooff th this is ppla lannnnin ingg rurunn.

R  S A P A G 0 6 /2 3 /9 7 . M u lti-L e v e l M R P M MRRPP -...MRP Control Parameters S in g le -Ite m . M Muulti-L lti-Leevveell TThhee PPlalannnniningg m mooddee ccoonntro troll ppaara rammeeteterr ddeete rm in e s h o w th e s y s te m re a c ts te rm in e s h o w th e s y s te m re a c ts to oord to rdeerr ppro roppoossaalsls.. fro from m ppre revvio iouuss ppla lannnniningg ru runnss.. wwhheenn th e y s till m e e t th e n e w re q u ire m e n th e y s till m e e t th e n e w re q u ire m e n ts ssituts ituaatio tionn.SSin inggle le-Ite -Item m.

.. M Muulti-L lti-Leevveell TThhee SScchheedduulin lingg ccoonntro troll ppaara rammeete terr ddeete termrmin ineess hhooww th th e le a d tim e fo r e a c h o rd e r w ill b e c a lc u late e le a d tim e fo r e a c h o rd e r w ill b e c a lc u la tedd. R  S A P A G 0 6 /2 3 /9 7 .MRP Control Parameters S in g le -Ite m . a s te r. M u lti-L e v e l M R P M MRRPP -.SSin inggle le-Ite -Item m. YYoouu mmaayy cchhoooossee to to ccaalc lcuula late te th thee le leaadd tim timee bbaasseedd oonn th th e o p e ra tio n s in th e ro u tin g o r to u see th e o p e ra tio n s in th e ro u tin g o r to u s thee bbaassic ic ppla n n in g d a te s fro m th e m a te ria l m la n n in g d a te s fro m th e m a te ria l m a s te r.

. M Muulti-L lti-Leevveell TThhee PPro rocceessss ccoonntrotroll ppaararam meeteters rs ddeete term rmin inee ifif ccoom m p o n e n ts w ill b e p la n n e d w h e th e r o r noott th p o n e n ts w ill b e p la n n e d w h e th e r o r n thee BBOOM M hhaass bbeeeenn cchhaannggeedd. wwhheeth theerr th thee MMRRPP lis listt wwillill bbee ddisisppla la y e d b e fo re s a v in g th e o rd e r p ro p o s alsls. M u lti-L e v e l M R P M MRRPP -.MRP Control Parameters S in g le -Ite m . aanndd y e d b e fo re s a v in g th e o rd e r p ro p o s a wwhheeth theerr th thee ru runn-tim -timee ssta tatis tistic ticss wwillill bbee ddisisppla R layyeedd....  S A P A G 0 6 /2 3 /9 7 .SSin inggle le-Ite -Item m.

Net Requirements Calculation
N e t R e q u ire m e n ts C a lc u la tio n fo r M a te ria ls
P la n n in g U s in g M R P
S to c k

F irm e d re c e ip ts

R e q m ts T im e

A v a ila b le q u a n tity
S a fe ty s to c k

N e t re q u ire m e n ts T im e

S h o rta g e
R

 SAP AG

Requirement Quantities

H o w to D e a l w ith U n fo re s e e n D e v e lo p m e n ts
in R e q u ire m e n t Q u a n titie s ?

S a fe ty s to c k
S a fe ty s to c k p a rtia lly a v a ila b le
D y n a m ic s a fe ty s to c k
S a fe ty tim e

R

 SAP AG

Safety Stock

S a fe ty S to c k P a rtia lly A v a ila b le

S to c k
O rd e r p ro p o s a l

A v a ila b le
p o rtio n

S a fe ty s to c k
T im e

R e q m ts

R

 SAP AG

Safety Time S a fe ty T im e T im e S a fe ty tim e R .

Safety Time in Production S a fe ty T im e in M u lti-L e v e l P ro d u c tio n P la n n e d o rd e r F in is h e d p ro d u c t T im e Reqm t S a fe ty tim e P la n n e d o rd e r C o m p o n e n ts T im e In d e p .re q m ts D e p e n d e n t re q m ts S a fe ty tim e R  SAP AG .

Lot Size Calculation L o t-S iz e C a lc u la tio n N e t re q u ire m e n ts T im e O rd e r p ro p o s a ls T im e R  SAP AG .

Lot Sizing .Overview Overview of Lot-Sizing Procedures Lot-Sizing Procedures Static Period Optimum procedures procedures procedures Lot-for-lot order quantity Daily lot size Part period procedure Least unit cost Fixed lot size Weekly lot size procedure Replenish up to Monthly lot size Groff reorder procedure maximum stock level Flexible periods Dynamic lot size according to R creation planning calendar  SAP AG .

Static Lot Sizing S ta tic L o t-S iz in g P ro c e d u re s L o t-fo r-lo t o rd e r q u a n tity Q u a n tity R e c e ip ts R e q m ts T im e P la n n e d w a re h o u s e s to c k = Æ F ix e d lo t s iz e R e p le n is h u p to m a x im u m s to c k le v e l R  SAP AG .

Period Lot .Sizing Procedure P e rio d L o t-S iz in g P ro c e d u re s R e c e ip ts T im e R e q m ts P e rio d 1 P e rio d 1 P e rio d 1 R  SAP AG .

Optimum Lot Sizing O p tim u m L o t-S iz in g P ro c e d u re s M a n y d e liv e rie s / M in im a l s to c k k e e p in g / H ig h o rd e r c o s ts M in im a l s to ra g e c o s ts F e w d e liv e rie s / M o re e x te n s iv e s to c k k e e p in g / L o w o rd e r c o s ts H ig h e r s to ra g e c o s ts R  SAP AG .

g . R  S A P A G 0 6 /2 3 /9 7 .Long Term Lot Sizing L o n g -T e rm L o t S iz e PPla lannnnin ingg hhooriz rizoonn SShhoort-te rt-term rm ppeerio riodd LLoonngg-te -term rm ppeerioriodd ee.  P la n n in g ru n is c a rrie d o u t in re g u la r in te rv a ls u s in g a tim e -p h a s e d p la n n in g ru n .g....g ..  D iffe re n t lo t-s iz in g p ro c e d u re s c a n b e d e fin e d fo r e a c h p e rio d . lo lot-fo t-for-lo r-lott oord rdeerr qqty ty ee... mmoonnth thlyly lo lott ssizizee  P la n n in g h o riz o n is s p lit in to tw o p e rio d s .g.

0 Reqm t Reqm t 3 /1 5 3 /1 5 900 900 3 0 0 p c b y 3 /1 5 3 0 0 p c b y 3 /1 5 3 0 0 p c b y 3 /1 4 3 0 0 p c b y 3 /1 6 3 0 0 p c b y 3 /1 3 3 0 0 p c b y 3 /1 7 R  S A P A G 0 6 /2 3 /9 7 . c y c le tim e 1 d a y B a c k w a rd o v e rla p p in g F o rw a rd o v e rla p p in g N E W 3 .Other Lot Sizing Features O th e r N e w L o t-S iz in g F e a tu re s  L o t-s iz e c a lc u la tio n fo r m a k e -to -o rd e r  O v e rla p p in g o f fix e d lo t s iz e w ith s p littin g  P e rio d lo t-s iz e w ith s p littin g a n d o v e rla p p in g F ix e d lo t s iz e 3 0 0 .

Lot Size Rounding Profiles L o t S ize R o u n d in g P ro file R o u n d in g p ro file X Y R eqm t O rd e r L e v el T h re s h o ld v a lu e R o u n d in g va lu e p ro p o s a l 1 2 5 2 32 40 1 0 2 5 6 5 7 10 21 20 22 25 31 30 32 40 41 40 74 80 R  S A P A G 0 6 /2 3 /9 7 .

Layout of MRP List .

.Stock Req.. C o n te n ts re a d w h e n P la n t s to c k / D a te S to ra g e lo c a tio n s to c k lis t is E x c e p tio n m e s s a g e accessed R e c e ip t/R e q m ts q u a n tity F o re c a s t re q u ire m e n ts A v a ila b le q u a n tity S a le s o rd e rs R e s e rv a tio n s R  SAP AG .Layout L a y o u t o f th e C u rre n t S to c k /R e q u ire m e n ts L is t C u rre n t s to c k /re q u ire m e n ts lis t V a ria b le h e a d e r C o n te n ts M a te ria l in fo rm a tio n R e c e ip t/S to c k lis t P la n n e d o rd e rs P u rc h a s e re q u is itio n s P ro d u c tio n o rd e rs P u rc h a s e o rd e rs M R P e le m e n ts . List .

MRP List .Collective Display .

Functions .MRP List .

the system will display the message allocated the highest priority. Creation of the MRP list depending on the exception message created. finish or opening date) Problems in BOM explosion Problems in scheduling Rescheduling The following settings can be made in Customizing: Priority: if several exception messages exist for one MRP element. Splitting into exception groups for the selection. R  SAP AG .Exception Messages Exception Messages Exeptions indicate: New order proposals created in the planning run Dates in the past (start.

p ro d u c tio n o rd er. p u rch ase o rd er. p lan n e d o rd er) EM noEM R e v ers e R e s ch e d u le R e s ch e d u le in R e c eip ts o u t? N o ! T im e T o le ran c e T o le ran c e R e q m ts R e s ch e d u lin g h o rizo n R .g .Rescheduling Checks R e sc h e d u lin g C h e c k fo r F irm e d R e c eip ts e .

10. Time Processing by MRP controller. Processing indicator set Reschedule Time New MRP list after the next planning run Same exception ==> Old exception Purchase order 4711/10 10.Old / New Exception Message Old / New Exception Messages Old MRP list Exception: bring forward Purchase order 4711/10 10. Time R  SAP AG .10.

Planned New Exception Message Order Conversion C o n ve rtin g P la n n ed O rd e rs C o llec tiv e ly P lan n ed o rd e rs C o n ve rt O p e n in g d ate T im e T o d ay R  SAP AG .

Material Supply for Production .

Collective Display .

Search in Individual List .

Functions C u r r e n t S to c k /R e q m ts L is t: F u n c tio n s PPro rocceessssin ingg oopptio tionnss M a te ria l m e m o H Heeaaddeerr ddaata ta C h e c k re s c h e d u lin g S e a rc h o p tio n s M a te ria l m a s te r d a ta S to c k s ta tis tic s V a ria b le h e a d e r S to c k s G o to n e x t M R P lis t C o n s u m p tio n v a lu e s in c o lle c tiv e d is p la y P la n n in g s e g m e n ts A Acctio tionnss fo forr M MRRPP eele lem meennts ts D Dis isppla layy oopptio tionnss D is p la y R e c e ip ts P e rio d to ta ls C hange G ro u p in g re q m ts R e q m ts C o n v e rt V a ria b le d is p la y o f P e g g e d re q m ts R d a te s O rd e r re p o rt  SAP AG .Current List .

Pegged Requirements
P e g g e d R e q u ire m e n ts

P la n n e d o rd e rs
FFin
inis
ishheedd ppro
rodduucctt

T im e

In d e p . re q m ts
S a le s o rd e r

P u rc h a s e o rd e r CCoom
mppoonneennts
ts

T im e

D e p e n d e n t re q m ts

R

 SAP AG

Order Report
O rd e r R e p o rt

S a le s o rd e r
FFin
inis
ishheedd ppro
rodduucctt PPla
lannnneedd oord
rdeerr

D e p e n d e n t re q m ts D e p e n d e n t re q m ts
AAsssseem
mbblie
liess
P la n n e d o rd e r PPro
rodduucctio
tionn oord
rdeerr

D e p e n d e n t re q m ts R e s e rv a tio n R e s e rv a tio n
CCoom
mppoonneennts
ts PPro
PPuurc
rchhaassee SSto
tocckk robble
lem
m !!!
!!!
oord
rdeerr

R

 SAP AG

Planning Time Fence
D e te rm in in g th e P la n n in g T im e F e n c e
BOM L e a d tim e
d ia g ra m
E1
M PS
A u tom atic or de r
M RP M an u a l m o n ito rin g
p ro p o sa ls
B1 B2

P la n n in g tim e fe n c e
P la n n in g le v e l
R1 R2
E1
B1 Open
B2 p e rio d
R1
D e te rm in e R2

- M a te ria l m a s te r P lan n in g h o riz o n
- M R P g ro u p

 B y u s in g th e p la n n in g tim e fe n c e , th e M R P c o n tro lle r c a n d e fin e a s p e c ific
p e rio d , fo r e a c h m a s te r s c h e d u le ite m , in w h ic h n o a u to m a tic c h a n g e s c a n b e
m a d e to th e m a s te r p la n .
 T h e M R P c o n tro lle r c a n d e fin e th e p la n n in g tim e fe n c e p e r m a te ria l in th e
m a te ria l m a s te r re c o rd (M R P 1 s c re e n ), p e r p la n t, o r p e r th e M R P g ro u p .
R

 S A P A G 0 6 /2 3 /9 7

Planning Time Fence .

Scheduling in PP S c h e d u lin g in P ro d u c tio n P la n n in g M a te ria l R e q u ire m e n ts P la n n in g  S e p a ra te s c h e d u lin g o f p la n n e d o r d e r s  E x a c t to th e d a y t  B a s ic d a te s c a lc u la te d P la n n e d s ta rt d a te P er io d s P la n n e d d e liv e r y d a te C re a tio n d a te  U s e s lo t-d e p e n d e n t/lo t-in d e p e n d e n t in -h o u s e p r o d u c tio n o r re p le n is h m e n t le a d tim e  O p tio n a lly u s e b a s ic p la n n in g d a y s fro m th e m a te r ia l m a s te r to im p ro v e p e rfo rm a n c e  O p tio n a l c a lc u la tio n o f c a p a c ity re q u ire m e n ts P ro d u c tio n o rd e r m a n a g e m e n t O rd e r h e a d e r o p er at io n s  L e a d tim e s c h e d u lin g  E x a c t to th e s e c o n d m a te ria l c om po n e n ts  B a s e d o n b a s ic d a te M RP M an u al P RT s  T a rg e t d a te s c a lc u la te d (s c h e d u le d d a te s ) c o st s p la n n ed t arg e t a ct u al 100 20 50 T a rg e t s ta rt d a te T a rg e t fin is h d a te  O p e r a tio n s p e c ific d a ta u s e d to c a lc u la te o rd e r d a te s  C a p a c ity r e q u ire m e n ts c a lc u la te d  SAP AG .

Scheduling .Basic Dates S c h e d u lin g : C a lc u la tio n o f B a s ic O rd e r D a te s R e q u ire m e n ts d a te fo r p ro d u c t B a c k w a rd s c h e d u lin g BS BF BS BF V a ria b le -s iz e p a rt P ro d u c t A s s e m b ly BS BF P la n n e d d e liv e ry tim e In -h o u s e p ro d u c tio n tim e In -h o u s e p ro d . tim e T im e F lo a t b e fo re E x e c u tio n tim e F lo a t a fte r p ro d u c tio n p ro d u c tio n  SAP AG .

Production Time S c h e d u lin g : In -H o u s e P ro d u c tio n T im e C a lc u la tio n o f p la n n e d d a te s R e q u ire m e n ts d a te BS BF In -h o u s e p ro d u c tio n tim e fro m m a te ria l m a s te r 10 20 30 40 50 F lo a t b e fo re L e a d tim e s c h e d u lin g F lo a t a fte r p ro d u c tio n u s in g ro u tin g p ro d u c tio n C a lc u la tio n o f p ro d u c tio n o rd e r d a te s In -h o u s e p ro d . tim e g re a te r th a n s c h e d u lin g in ro u tin g In -h o u s e p ro d . tim e s m a lle r In c o rre c t in -h o u s e p ro d u c tio n tim e in m a te ria l m a s te r ?  SAP AG .Scheduling .

Planning Process Supply Plant Demand Stock MRP Planning Parameters Order External Proposal In-House Procurement Production .

Planning Process .

Production Execution • Stock transfer to WIP location • Order Execution − Production confirmation − Error handling .

Planning Process .

Planning Process .

Production Execution Physical Movement Storage Loc MAIN Storage Loc WIP .

Production Execution Planned Order Availability Check Convert Order BOM Production Routings Move Order floorstock Work Center Release Avail check Goods issue Production Confirmation Goods receipt TECO .

Best Practices Logistics Planning Make-To-Stock Discrete Manufacturing Production Subcontracting (External Processing) Rework Processing (Stock-Manufactured Material) Rework Processing (Work-In-Process) .

• Benefits − Seamless Integration in complete planning cycle • CO-PA  SOP  LTP  Demand Planning • Key process flows covered − Sales and Operation Planning − Long Term Planning .Logistics Planning Purpose and Benefits: • Purpose − The purpose of logistics planning is to make sure that future demand can be satisfied by your company’s available resources and to point out situations where demand cannot be met in time or in the desired quantities.

•The Best Practice scenarios in this section cover the following planning workflow:  Planning/forecasting of future demand  Aggregated production planning including capacity check in order to check at product group level if demand can be satisfied (using the SOP functionality)  Transfer of results to Long Term Planning (using the LTP module) to enable simulation of material requirements. based on the production plan (s)  Planning takes place in separate (simulative) planning versions within LTP  Review and adjustments of planned requirements as needed  Once the simulated requirements are accepted.Logistics Planning Detailed Process Description: •This process sometimes is called ‘Sales and Operations Planning’. the demand (independent requirements) is then transferred to active demand management for detailed MRP and Production Planning / Scheduling in the active version. Once a feasible production plan is found that satisfies demand it can be used as the basis for operational production planning (MRP and Detailed Capacity Scheduling). . The process usually takes place in a simulative mode and at an aggregated (usually product group rather than end-item) level.

MRP = Material Requirements Planning . LTP = Long Term Planning.Logistics Planning – Process Flow Diagram Operational Periodic Sales Production and Operations Planning & Meeting Control (Production scenarios) Event Revenue Planner Sales Qty Budget and Transfer to SOP Sales Quantity (with CO-PA). SOP = Sales and Operations Planning. forecast (179) Revenue Planning (172) SOP Verification Transfer Rough Demand Verification Cut Production Create LTP Execute LTP Evaluate (Check Sales Plan) Plan to Inactive Planning MRP Capacity  Create Rough-Cut Demand Scenario Planning Production Plan Management Operative Productio Strategic Planner n Data Copy to Active Acceptable Demand No Plan Management Yes CO-PA = Profitability Analysis.

external processing • Key process flows covered − Creating Planned Independent Requirements − Material Requirements Planning at Plant Level − In-House Production (subassembly) − In-House final assembly (Finished Good) − Capacity Leveling − Confirming Assembly Activities . consigned inventory. the scenario is supported by the main cost object controlling functions required.Make-To-Stock Production with Discrete Manufacturing Purpose and Benefits: • Purpose − This scenario describes a business process. − Furthermore. such as preliminary costing and period-end closing. which is typical for companies with lot-size oriented production. • Benefits − Production triggered by a production plan − Serial number and batch management included − Optional with: quality management. − The production scenario produces a finished good and all dependent components in make-to- stock production (MTS).

 In material requirements planning. which are used in the subsequent Material Requirements Planning (MRP) run. Work in Progress is settled to financial accounting and production variances are settled to management and financial accounting. MRP results in planned orders being generated for the material to be produced. which enables you to keep track of and compare target costs and actual costs at any time.Make-To-Stock Production with Discrete Manufacturing Detailed Process Description: This scenario describes a business process. Demand Management generates independent requirements. which is typical for companies with lot size oriented production.  The typical planning process starts with sales quantity planning. When the order is created. The production scenarios consist of both goods movements (goods issues and receipts) and confirmation of completion of the production order. .  Period-end-closing activities are applied to the order.  In Sales and Operations Planning. you ensure that production stays in line with sales so that you may create the production plan synchronously to sales.  During the production process. the bill of materials (BOM) for the top-level material demand gets exploded and production is planned right down to procured component level. costs incurred are updated on the order.  Furthermore. The planning data is transferred from Sales and Operations Planning to Demand Management.  After this. This includes Work In Progress calculation and variance calculation. purchase requisitions are created for the raw materials required. target costs are calculated for the order lot size (preliminary costing). the scenario is supported by the main cost object controlling functions required. The previous period’s actual sales figures can be used as a basis for future planning. such as preliminary costing and period-end closing.  If insufficient warehouse stock is available.

k. Make-to-Stock Production – Discrete Industry – Process Flow Diagram Beginning of Periodic Plan Event Planning Cycle Revision Strategic Planner Creating Planned Logistics Independent Planning Requirements (144) Material Requirements No Capacit Planning at Plant Level & y Evaluation of Stock / Update Capacity Levelin 1 Requirement List g O.? Production Planner Yes MRP List Convert Material Release Order Print Purchase Planned Available Yes Capacity Production Planned Order to Leveling Requisition Orders Production Order ? Order No Confirming Material Staging Assembly Semi-Finished Inventory @ Pick List Activities Standard. Cost Back flush Slip Goods Receipt Finished Goods Ware- Control house Slip Clerk Receipt Period End Closing “General” Plant Plant ler (181) PP- Procurement Procurement of Procurement & MM Subcontracting Buyer w/o QM Stock Material Consumption of Subcontracting (External (130) with QM (127) Cosigned (138) Processing) Inventory (139) (150) . Cost Manufacturing for Planned Goods Receipt Orders / Final Confirmation Inventory Consumption @ Goods Issue/ Goods Receipt Standard.

Make-to-Stock Production – Discrete Industry – Process Flow Diagram Event Production Supervisor Review 1 Operation List .

that are operations or sub-operations. the assembly procedure of the finished product can be assigned to a subcontractor • Key process flows covered − Creating Purchase Order for External Processing − Goods Receipt for “subcontracting” Purchase Order − Enter Invoice − Periodic Payment . the system will check to see if there are any routing/work-center operations which require external processing. which are performed outside of your company by a vendor.Production Subcontracting (External Processing) Purpose and Benefits: • Purpose − During the Manufacturing process. if capacity bottlenecks occur. • Benefits − An outline agreement can specify that a certain operation of the production order is executed by an external subcontractor on a regular basis − In the case of capacity bottlenecks. when a "Planned Order" for Production is converted to a "Production Order". It can also provide a company with a feasible alternative to in-house processing. External processing is when you have individual production steps. This type of processing is particularly important for subcontracting.

The buyer/planner/scheduler creates a manual shipping document and provides the information to the shipping department on what components need to be gathered for the external processing and ships the components to the vendor. The warehouse clerk receives the externally processed goods back into the warehouse. The purchase order informs the vendor which service is required. The system automatically creates a purchase requisition for the operation or sub-operation that requires external processing. − The goods receipt of an externally processed material causes the status of the operation to be updated: For a partial delivery of an external process operation. it is determined whether externally processed operations are scheduled on the basis of their standard values or the planned delivery time. − Once the purchase order is created it is printed and sent to the vendor. external operations need to be taken into account. The Production scheduler should inform the buyer they need to check the workload for requisitions that require external processing. This information is needed to settle externally processed operations and sub-operations that have been marked as relevant for costing in their control keys. the material is shipped back. A decision needs to be made as to whether an operation or sub- operation is processed externally via its control key. The duration of an external operation is calculated either by using the planned delivery time or using the standard values. − When the vendor has completed the external processing. the status is: EOPD (External operation . The purchase order and the production order show the quantity received. − Purchasing should not convert the purchase requisition until the external processing is required. The vendor service is reflected on the production order via an operation confirmation. Production Subcontracting (External Processing) Detailed Process Description: •Production Subcontracting (External Processing) − When a Production Order is scheduled. The cost element determines how the external activity is to be valuated. a cost element is specified. The reason for this is that any quantity changes on the production order will automatically update the requisition. − When data is maintained for an external activity. .partial delivery) and for final delivery of a external process operation the status is: EOFD (External operation - final delivery). In the control key.

GR/IR = Goods Receipt/Invoice Receipt. RFQ = Request for Quotation. PO = Purchase Order. Production Subcontracting (External Processing) – Process Flow Diagram Vendor Receives Ship External Incoming Material and Perform External Vendor Performs External Services Material Back Vendor Services to Plant Invoice Production Order Generates Purchase Completion Requisition for Confirmation External Services of Production Event Order Check Order Production Supervisor Operations Create PO from Print Purchase Purchase Req (Vendor Order Purchaser assigned by Info record) Warehouse Deliver Ship Subcontract Goods Receipt Material Material to Services GR/IR for Back to Vendor Subcontracting Shop Clerk PO Floor Accountant Periodic GR/IR PPV Payment: Accounts Vendor Invoice Receipt Payable Accounts Payable (158) PP = Production Planning. PPV = Purchase Price Variance .

Rework Processing (Work-In-Process) Purpose and Benefits: • Purpose − Processing of defective material on a production order. additional activity and material consumption can be confirmed. • Benefits − Scraps at defined operation automatically trigger rework process. − Fully integrated in the production process • Key process flows covered − Confirming Production Activities − Confirm Scrap defective material − Confirm Parent Order at Rework Operation − Continue Shop floor-Activities . − After rework.

Rework Processing (Work-In-Process) Detailed Process Description: This scenario focuses on a rework process within production. The additional rework operation is confirmed and settled within the original production order. . All required rework activities are related to the parent production order. causing production variances within controlling and price differences for the dedicated product. For this reason. errors are recognized and corrections initiated such as insertion of a rework operation within the same production order.

Rework Processing (Work-in-Process) – Process Flow Diagram Confirming Production End Process Activities Event Confirm Parent Confirm Scrap Production Order for Continue Shop-Floor- Defective Material Reworked Quantity That Activities for Non- Can Proceed to Defective-Quantity Subsequent Operations No Confirm Parent Any Insert Rework Production Order at Complaint Operation on Parent Shop Floor Specialist Rework Operation Quantity to Production Order for Non-Defective Be Automatically Quantity Scrapped? Scrap Defective Quantity that Can’t Be Yes Reworked .

Rework Processing (Stock-Manufactured Material) Purpose and Benefits: • Purpose − This process covers the rework of defective manufactured materials that are found in the warehouse. • Benefits − Transparent costs for rework activities − Use of all standard shop-floor control functionalities is possible • Key process flows covered − Create rework production order − Goods issue for defective material − Confirmation of rework production activities − Posting goods receipt for rework production order .

Rework Processing (Stock-Manufactured Material) Detailed Process Description: •Rework Processing (Stock-Manufactured Material) •For materials that can be reworked. a production order is created for correcting the defect. . The costs associated with the rework production order will be settled to profitability as a material variance.

Rework Processing (Stock-Manufactured Material) – Process Flow Diagram Identified Component in Stock Requires End Process Event Changes Production Create Rework Release Rework Production Order Production Order Planner Confirmation of floor Specialist Rework Production Activities Warehouse Clerk Shop Posting Goods Receipt for Goods Issue for Rework defective Material Production Order Production Supervisor Review Order Confirmations .