SAP Business Suite powered by SAP HANA | Fact Book
Manufacturing
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SAP Business Suite powered by SAP HANA | Fact Book
SAP® Business Suite powered by SAP HANA®
Manufacturing
Successful manufacturers capture the opportunities of a global
economy while effectively managing their complex, distributed,
and volatile business network. Changing customer demand,
production standstills, and disrupted supply requires
continuous adjustments of production and procurement plans.
Thriving in this environment begins with a new attitude toward
change. No longer considered an inconvenient disturbance of an
otherwise exceptional plan, change becomes the agent that
drives continuous adjustments of plans to reflect reality.
Reality changes in real time. Companies can reflect the reality of
planning and operations at this speed of change to deliver
responsive manufacturing using SAP® Business Suite powered
by SAP HANA® to optimize cost and performance objectives.
SAP solutions also support manufacturers in running their
“perfect plant” with integrated, comprehensive processes that
deliver deep manufacturing planning, execution, and quality
management capabilities.
SAP Business Suite powered by SAP HANA leads the way to
new, real-time business practices in key manufacturing areas:
Production Planning ................................................................................. 4
Material Requirements Planning ......................................................... 4
Efficient Manufacturing Operations ...................................................... 10
Global Plant Performance Management ........................................... 10
SAP Business Suite powered by SAP HANA | Fact Book
Production Planning
Material Requirements Planning
Business Practices Today
Material requirements planning (MRP) forecasts procurement or production
of materials to satisfy internal requisitions and external orders from
customers or distribution channels.
Periodic MRP runs analyze demand based on sales orders, forecasts, stock
transfers, and dependent requirements. This analysis matches demand to
inventory levels, planned supply from production orders, purchase
requisitions, and purchase orders.
MRP runs plan production orders and purchase requisitions to fill the gap
between supply and demand. This process iterates because planned orders
create new demand for lower-level components or ingredients. New stocktransfer requisitions create new demand for the supplying plants.
MRP runs usually occur once a day because they often run for several
hours.
Ambition
Fast MRP
5 to 10 times faster
than on a classic
database (based on
internal testing of a
typical SAP customer
data set)
Sales orders and the supply chain continuously change and ignore the
runtime constraints of material requirements planning. MRP plans need to
reflect changes in sales and operations because they can become outdated
almost immediately.
Our customers can realize considerable advantages by running MRP more
frequently to reflect daily changes to supply and demand. Simulation and
analysis shows that tracking MRP supply-and-demand forecasts and actuals
more closely can reduce lead time and can improve order-fill rates and asset
usage, while reducing inventory levels.
In a first phase, SAP Business Suite powered by SAP HANA can run MRP
functions several times a day. Ultimately, periodic MRP functions can react
permanently on supply-and-demand signals and update production and
procurement plans in real time.
The next level of business practices may extend MRP from a single plant to
a network of plants and eventually reach beyond the walls of the enterprise
to connect customers and suppliers. This scenario suggests that a cloudbased, collaborative MRP can move from local to global optimization.
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Challenges
Planners face the following challenges when running MRP:
• The consequences of supply-and-demand changes are invisible
until the next MRP run.
•
Only one MRP run can be performed at a time, so the duration of an
MRP run can constrain the frequency of MRP runs.
•
Tuning MRP for speed is difficult in many databases without inmemory capability. Many techniques already improve performance,
such as planning in the planning horizon only (NETPL), parallel
processing, and using aggregated dependent requirements. A real
break-through needs a change in technology.
•
Currently, MRP can run only for a single plant. In multiplant
scenarios, the planning sequence must be defined manually. This
process still does not guarantee coverage of all stock transfer
requirements after all planning runs have finished.
Business Innovation with SAP HANA
Simple
MRP
SAP HANA software enables business process innovations that solve the
major MRP challenges with fast, simple, and cross-plant MRP.
Innovation in Detail with SAP HANA
Fast MRP: A large chunk of MRP runtime goes into reading many different
material receipts and requirements. SAP HANA can collect this information
with unprecedented speed. Net requirements calculation, lot sizing,
sourcing, scheduling, and bill-of-material (BoM) explosion now run directly in
SAP HANA and benefit from the optimized data access.
CrossPlant
MRP
Simple MRP: Many performance measures required by classic MRP
become obsolete when running MRP functions in SAP HANA. Planning
within the planning horizon only and specifying application servers for
parallel processing is no longer necessary.
Cross-plant MRP: MRP functions enabled by SAP HANA use special
procurement keys to determine the planning sequence for multiple plants.
The MRP run automatically plans for supplying plants after receiving plants,
so that stock transfer requirements are covered after the MRP run.
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Benefits
The main advantage of running MRP processes on SAP HANA involves
more-frequent planning runs that reflect daily changes in supply and
demand:
• More-current supply-and-demand information promotes better
decision making and results in timely delivery and happier
customers.
•
Faster reaction to demand changes reduces the risk of stock-outs,
reducing safety stocks and required working capital.
•
Supply-and-demand matching runs more efficiently, providing more
lead time to identify and fix issues earlier and faster.
Customers also benefit from the new planning scopes supported by MRP
functions enabled by SAP HANA:
• Selective planning: Selected material in a selected location (such
as a distribution center) and its supplying locations (such as a
production plant)
New
Planning
Apps
•
Multilevel planning: Selected material in a selected location and its
supplying locations along with components in one or more
production locations, at multiple levels across the complete supply
chain
•
Planning for planners: All the materials for which one planner is
responsible
SAP Smart Business Cockpit for MRP
SAP Smart Business for MRP consists of a set of apps providing new
options for monitoring key performance indicators (KPIs) and alerts for
solving planning issues. The apps, available on desktop and tablet
computers, provide various ways to identify the most urgent and important
issues based on time to action, order values, or priorities. In addition, the
apps offer pre-evaluated solution proposals with simulation capabilities to
help solve issues quickly. See figures 1 through 4 for details of MRP cockpit
displays provided by these apps.
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SAP Business Suite powered by SAP HANA | Fact Book
Figure 1: Preview of MRP Cockpit Showing Performance Indicators and Alerts
Figure 2: MRP Cockpit Display of List-of-Material Shortages
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SAP Business Suite powered by SAP HANA | Fact Book
Figure 3: MRP Cockpit Display of Detailed Supply-and-Demand Information for Selected
Material
Figure 4: MRP Cockpit Display of Pre-Evaluated Solutions for Critical Situations
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SAP Business Suite powered by SAP HANA | Fact Book
Road Map and Outlook
Additional MRP features available in SAP HANA: The SAP ERP
application, with a 20-year history of continuous improvements, supports a
large number of business processes for a wide range of industries. The MRP
functions enabled by SAP HANA, already faster, cover many but not all
these business processes. Anticipated MRP functions in SAP HANA will
enable planning of additional material types in SAP HANA.
Performance optimization: Additional functions such as product
configuration will run directly in SAP HANA in a nondisruptive way.
Insight and decision support for planners: In the next phases, MRP will
contain what-if analysis and decision-support elements. Next phases may
also include support for subcontracting or make-or-buy decisions. These
enhancements will show planners clearer pictures for better decision making.
Additional apps and features in SAP Smart Business for MRP: New
features will continuously enlarge and enrich the set of apps to cover
additional aspects such as a dedicated analysis of production orders and
production requirements.
Product Landscape Requirements
SAP ERP 6.0 with SAP enhancement package 7 SPS 05 or above
(SAP Smart Business for MRP requires SP 3.)
SAP Fiori for ERP 1.0 SPS 03
SAP NetWeaver® 7.40
How to Get Started
For information on how to get started, see the business function
documentation in Service Marketplace and SAP help portal (log-in required).
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SAP Business Suite powered by SAP HANA | Fact Book
Efficient Manufacturing Operations
Global Plant Performance Management
Business Practices Today
Most manufacturers manually calculate plant performance indicators and
capture weekly or monthly in data warehouses and legacy systems for
retrospective performance analysis.
This means that deviations from planned performance cannot be detected
early enough to prevent unplanned downtime. Side effects include waste
and product quality, order fill rates, and ultimately, return on the production
assets.
SAP ERP and
SAP HANA:
Plant system
One solution that integrates
the corporate system with
the shop-floor system
Ambition
Plants need an integrated system that connects the corporate “top-floor”
system with the shop-floor system to deliver responsive manufacturing for
achieving and sustaining optimal performance.
Real-time visibility into plant operations and continuous performance
analysis across assets and plants are strategic to reducing manufacturing
cost. This visibility also helps increase the return on assets while optimizing
order fill rates, product quality, and resource usage.
Intuitive user interfaces on stationary and mobile devices and machine-tomachine connectivity increase acceptance on the shop floor, improve data
quality, and lay the foundation for effective performance analysis and
corrective action.
Challenges
Identifying and resolving performance bottlenecks on the shop floor is
challenging, especially in a manufacturing environment without a
comprehensive system to understand and analyze losses in operational
performance:
• No real-time performance management platform can run without the
ability to continuously gather, compare, analyze, and visualize
production data per plant and across multiple production sites.
•
Decentralized production data capturing and batch-driven data
consolidation disguise machine maintenance issues and production
bottlenecks.
•
Manual capturing of root causes for downtime, efficiency loss, and
poor quality is tedious, error prone, and frustrating. Postmortems are
interesting, but today manufacturers focus on anticipating and
preventing incidents.
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SAP Business Suite powered by SAP HANA | Fact Book
•
Unplanned downtime, suboptimal performance, and poor product
quality contribute to decreased asset usage. Poor product yields and
quality result in increased costs of goods sold and, ultimately, late
orders and reduced responsiveness to customers.
•
Production event data stored in disconnected systems on machine
and plant levels make it difficult to consolidate data for near-time
root-cause analysis.
Business Innovation with SAP HANA
The SAP Overall Equipment Effectiveness Management (SAP OEE
Management) application monitors the effectiveness of manufacturing
processes by capturing information on manufacturing productivity loss. The
application categorizes this information into availability, performance, and
quality impacts, and then distills it into a system of KPIs and underlying
performance data. This systemization builds the foundation to measure
manufacturing performance, identify optimization potential, collaborate on
corrective action, and implement resolutions in real time.
Key features of SAP OEE Management include:
• Real-time combination of quantitative performance metrics with
target values, qualitative context, and potential reasons for
performance issues
•
Combination of plant performance with business context for
understanding broader implications of substandard plant
performance
•
Facilitation of corrective action on the plant level and across plants
for the entire enterprise
•
Enablement of performance improvements beyond the plant level,
including supply chain, sustainability, financials, and customer
relationship
•
Storage for a broad set of granular manufacturing data for detailed
analysis, complex production modeling, and predictive analytics
including regression and heuristics
This data becomes the foundation for plant operations that takes corrective
action before actual quality of performance issues occur. Check figure 5 for
a sample report from SAP HANA of analysis of manufacturing KPIs using
drill-down and filtering functions.
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SAP Business Suite powered by SAP HANA | Fact Book
Figure 5: Report from SAP HANA Analyzing Manufacturing KPIs with Multilevel DrillDown and Filtering
Innovation in Detail with SAP HANA
State-of-the-art reporting: Intuitive reports (built with SAP UI5) support
analysis of operational performance.
Global plant performance comparison: SAP HANA provides the ability to
compare performance across the global manufacturing organization
(multiple regions, countries, and plants). Data from multiple shop-floor
systems can be analyzed in a single report.
Real-time manufacturing analytics: SAP HANA enables the capacity to
locate losses in performance, identify root causes by drilling down to the line
item data, and fix the problem.
Integrated solution: SAP OEE Management provides integration of the
manufacturing shop floor, the corporate SAP ERP application, and SAP
HANA. This integration establishes a single source for all production
planning, execution, and analysis processes.
Automation support: SAP HANA enables immediate analysis of highfrequency and large-volume manufacturing data received from automated
systems on the shop floor.
Bidirectional top-floor to shop-floor integration: A download of a
production order or process order to the SAP Manufacturing Integration and
Intelligence (SAP MII) application collects information for confirmations and
propagation of confirmations back to SAP ERP.
See figure 6 for a comprehensive solution approach from SAP.
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SAP Business Suite powered by SAP HANA | Fact Book
Figure 6: Comprehensive Solution Approach
Benefits
Universally accepted metrics: Overall equipment effectiveness is an
industry-wide standard to measure and benchmark plant performance. This
KPI system provides a holistic picture of the manufacturing operations.
High-speed manufacturing analytics: Large volumes of manufacturing
data that used to take days to analyze can now be understood with a few
clicks.
Extensibility: Customers can easily extend SAP OEE Management with
their specific reports that just plug into the standard reports.
Personalization: Individual users can personalize reports in SAP OEE
Management using the variant feature. Users can also analyze reports with
other reporting tools like SAP BusinessObjects Analysis, edition for Microsoft
Office.
Enterprise-wide data analysis: In combination with SAP ERP and the shop
floor, SAP OEE Management supports distributed and detailed plant-level
analysis, as well as central, consolidated global analysis.
Shop-floor acceptance: Shop-floor operators now have a highly intuitive
user experience for data entry and real-time analysis of SAP OEE
Management, which fosters acceptance and bottom-up process
optimization.
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SAP Business Suite powered by SAP HANA | Fact Book
Lean and intuitive solution: SAP OEE Management, a lightweight solution,
can function in discrete and process manufacturing industries.
Paperless shop floor: Data collection on the shop floor is completely
automated with integrated confirmation from SAP ERP and replication from
SAP HANA, which helps eliminate paper from the shop floor.
Full cycle of continuous improvement: SAP OEE Management
orchestrates manufacturing execution and manufacturing performance
analysis. See details of the software’s user interface in figure 7.
Paperless
Shop Floor
No more use of paper
to track operations
(based on an SAP customer proof of concept
for an implementation
project)
Figure 7: Operator-Grade User Interface of SAP® OEE Management with SAP HANA
Road Map and Outlook
The intended road map of SAP OEE Management working with SAP HANA
includes:
• Translating operational performance into financial performance by
providing cost-based reports in SAP HANA
•
Integration with the quality management component in SAP ERP:
losses incurred by rejections in the quality department will be
integrated into SAP OEE Management
•
Integration with the plant maintenance module: real-time
notifications will be integrated with SAP OEE Management for
analysis in SAP HANA
•
Integration with the enterprise tag catalog and self-service
composition environment in SAP MII
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Product Landscape Requirements
•
On-premise application based on SAP NetWeaver 7.30 or higher
•
SAP ERP 6.0 or above for a configuration for SAP OEE
Management
•
SAP Fiori for SAP ERP 1.0 or above
•
SAP HANA 1.0 or above for enterprise data warehouse for SAP
OEE Management
•
Analytics foundation 1.0 or above for SAP HANA
•
SAP MII 14.0 for plant connectivity and integration with SAP ERP
Central Component (SAP ERP)
•
SAP Plant Connectivity 2.3 for automated data gathering
Figure 8: Product Landscape in SAP OEE Management with SAP HANA
Watch the speed demo.
Find out more in the RKT Learning Map.
* Source: SAP internal lab tests as of Sept. 2013. All performance KPIs are preliminary. SAP internal lab measurements and productive customer
performance can deviate.
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could cause actual results to differ materially from expectations.
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should not be relied upon in making purchasing decisions.