Ferenc Gulyássy, Marc Hoppe, Martin Isermann, Oliver Köhler
Materials Planning with SAP
®
Bonn � Boston
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Contents at a Glance
PART I Basic Principles and Processes of Materials Planning
1 Basic Principles of Materials Planning ..............................................
25
2
Strategic versus Operational Materials Planning ..............................
49
3
Item Classification as the Basis for Materials Planning Decisions ......
55
4
Materials Planning Process in SAP ...................................................
97
Part II Materials Planning Parameters in the SAP System
and Their Impact
5 General Materials Planning Master Data . ........................................ 127
6
Planning Strategies and Requirements Consumption ....................... 135
7
Determination of Requirements Through Planning and Forecasts .... 173
8
Materials Planning Procedures ........................................................ 203
9
Procurement Quantity Calculation . ................................................. 229
10 Safety Stock Planning ...................................................................... 253
11 Determining Sources of Supply . ...................................................... 287
12 Scheduling Parameters .................................................................... 323
13 Interactions ..................................................................................... 349
Part III Materials Planning Optimization
14 Processing Materials Planning Results ............................................. 359
15 Availability Check ............................................................................ 373
16 Collaborative Materials Planning Procedures ................................... 387
17 Materials Planning with Kanban Control ......................................... 405
18 Inventory Controlling ...................................................................... 425
19 Materials Planning Optimization ..................................................... 481
20 Outlook .......................................................................................... 521
Appendices
A Literature ........................................................................................ 527
B
Materials Planning Parameters and Influencing Factors . .................. 529
CMaterials Planning Optimization — Four Steps for
Implementation with the Support of SAP Consulting ....................... 547
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D
Add-Ons for SAP ERP . .................................................................... 551
E
The Authors .................................................................................... 553
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Contents
Introduction ............................................................................................... 17
PART I Basic Principles and Processes of Materials Planning
1 Basic Principles of Materials Planning ...................................... 25
1.1
1.2
1.3
1.4
1.5
1.6
1.7
Goals and Tasks of Materials Planning .......................................... Core Functions of Materials Planning ........................................... Requirements Calculation ............................................................ 1.3.1 MRP (Deterministic) Determination of Requirements ...... 1.3.2 Consumption-Oriented (Forecast-Based)
Determination of Requirements ...................................... 1.3.3 Order-Based Determination of Requirements .................. Accumulate Balances ................................................................... Purchase Order Calculation . ........................................................ 1.5.1 Reorder Cycle Method .................................................... 1.5.2 Reorder Point Method .................................................... 1.5.3 Mixed Procedure . ........................................................... 1.5.4 Overview of Reorder Policies . ......................................... Impact of Materials Planning on Inventory . ................................. 1.6.1 Selecting the Production Type ......................................... 1.6.2 Selecting the MRP Strategy/Determining the
Stocking Level ................................................................. 1.6.3 Selecting Consumption Parameters . ................................ 1.6.4 Selecting Lot-Sizing Parameters ....................................... 1.6.5 Selecting the Safety Stock Procedure ............................... 1.6.6 Selecting the Forecast Strategies ..................................... 1.6.7 Item Classification and Product Analysis .......................... Conclusion . ................................................................................. 25
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2 Strategic versus Operational Materials Planning ..................... 49
2.1 Tasks in Materials Planning .......................................................... 2.2 Organizational Integration of Materials Planning . ........................ 2.3 Conclusion . ................................................................................. 49
51
54
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Contents
3 Item Classification as the Basis for
Materials Planning Decisions .................................................... 55
3.1
3.2
3.3
3.4
3.5
Options Provided by Item Classification ....................................... 3.1.1 ABC Analysis ................................................................... 3.1.2 XYZ Analysis ................................................................... ABC Analysis with SAP . ............................................................... 3.2.1 Outlining the Analysis Process . ....................................... 3.2.2 Determining the Analysis Goal ........................................ 3.2.3 Defining the Area to Analyze . ......................................... 3.2.4 Calculating the Data Basis ............................................... 3.2.5 Defining the ABC Strategy ............................................... 3.2.6 Defining Class Limits ....................................................... 3.2.7 Assigning Classes . ........................................................... 3.2.8 Evaluating ABC Analysis .................................................. 3.2.9 Performing an ABC Segmentation . .................................. 3.2.10 Case Scenario: ABC Analysis for
Warehouse Optimization ................................................ 3.2.11 Case Scenario: ABC Quantity Flow Analysis ..................... XYZ Analysis in the SAP System ................................................... 3.3.1 Running Analyses in SAP ERP .......................................... Combining ABC and XYZ Analyses ............................................... 3.4.1 Optimization Using the ABC/XYZ Matrix . ....................... 3.4.2 Using SAP ERP to Create an ABC/XYZ Matrix .................. Conclusion . ................................................................................. 56
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4 Materials Planning Process in SAP ........................................... 97
4.1
Business Overview ....................................................................... 4.1.1 Program Planning . .......................................................... 4.1.2 Quantity Planning ........................................................... 4.1.3 Scheduling and Capacity Requirements Planning ............. 4.1.4 Order Conversion and Monitoring . ................................. 4.2 Overview of the Materials Planning Process in the SAP System .... 4.3 Materials Planning Process in SAP ERP ........................................ 4.3.1 Program Planning . .......................................................... 4.3.2 Quantity Planning ........................................................... 4.3.3 Scheduling and Capacity Requirements Planning ............. 97
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Contents
4.3.4 Order Conversion and Monitoring . ................................. 4.4 Materials Planning Process in SAP APO ....................................... 4.4.1 Demand Planning ........................................................... 4.4.2 Supply Network Planning (SNP) ...................................... 4.4.3 Production Planning and Detailed Scheduling ................. 4.5 Conclusion . ................................................................................. 112
114
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119
124
Part II Materials Planning Parameters in the SAP System
and Their Impact
5 General Materials Planning Master Data . ................................ 127
5.1 Differences Between SAP ERP and SAP APO . .............................. 5.2 Mass Maintenance of MRP Master Data ...................................... 5.2.1 MRP Group . ................................................................... 5.2.2 MRP Profile .................................................................... 5.2.3 Transaction MASSD . ....................................................... 5.3 Special Materials ......................................................................... 5.4 Conclusion . ................................................................................. 127
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6 Planning Strategies and Requirements Consumption .............. 135
6.1
System Settings in SAP ERP ......................................................... 6.1.1 Relationship Between the Strategy and
Requirements Class ......................................................... 6.1.2 Assigning a Planning Strategy to a Material ..................... 6.1.3 Consumption Parameter .................................................. 6.2 Planning Strategies in SAP ERP .................................................... 6.2.1 Strategies for Make-to-Stock Production ......................... 6.2.2 Final Assembly by Sales Order ......................................... 6.2.3 Make-to-Order Production ............................................. 6.2.4 Planning with a Planning Material ................................... 6.2.5 Assembly Processing ....................................................... 6.2.6 Strategies for Configurable Materials ............................... 6.2.7 Reducing Planned Independent Requirements ................ 6.2.8 Adjusting and Reorganizing
Planned Independent Requirements . .............................. 6.2.9 Table Summary of Planning Strategies ............................. 135
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Contents
6.3 Planning Strategies in SAP APO ................................................... 6.3.1 Requirements Class and Check Mode .............................. 6.3.2 Customizing of Planning Strategies .................................. 6.3.3 Planning Parameters in the Product Master ..................... 6.3.4 Planning Strategy Names in SAP ERP and SAP APO . ....... 6.4 Conclusion . ................................................................................. 168
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7 Determination of Requirements Through
Planning and Forecasts . ............................................................ 173
7.1
7.2
7.3
7.4
Forecasts in SAP ERP and SAP APO ............................................. 7.1.1
Forecast Methods ........................................................... 7.1.2 Forecast Parameters ........................................................ Forecasting Accuracy ................................................................... 7.2.1 Error Total (ET) . .............................................................. 7.2.2 Mean Absolute Deviation (MAD) .................................... 7.2.3 Mean Square Error (MSE) ................................................ 7.2.4 Root of the Mean Square Error (RMSE) ........................... 7.2.5 Absolute Percentage Error (APE) ..................................... 7.2.6 Mean Absolute Percentage Error (MAPE) ........................ 7.2.7 Median of the Absolute Percentage Error (MdAPE) ......... 7.2.8 Relative Absolute Error (RAE) .......................................... Forecast Results and Demand Management ................................. 7.3.1 Adjusting Historical and Forecast Data and
Other Influences ............................................................. 7.3.2 Guidelines for Materials with a High Forecast Error ......... 7.3.3 Results Evaluation ........................................................... Conclusion . ................................................................................. 173
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8 Materials Planning Procedures ................................................. 203
8.1
Materials Planning Procedures in SAP ERP ................................... 8.1.1 Consumption-Based Planning . ........................................ 8.1.2 Deterministic MRP . ........................................................ 8.2 Materials Planning Procedures in SAP APO .................................. 8.2.1 PP Procedure .................................................................. 8.2.2 Heuristics ........................................................................ 8.3 Conclusion . ................................................................................. 203
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Contents
9 Procurement Quantity Calculation . .......................................... 229
9.1 Business Background ................................................................... 9.2 Procurement Quantity Calculation in SAP ERP ............................. 9.2.1 Static Lot-Sizing Procedures ............................................ 9.2.2 Periodic Lot-Sizing Procedures ........................................ 9.2.3 Optimum Lot-Sizing Procedures ...................................... 9.2.4 Lot-Size Restrictions ........................................................ 9.2.5 Additional Lot-Size Options ............................................ 9.2.6 Scrap Quantity Calculation .............................................. 9.3 Procurement Quantity Calculation in SAP APO ............................ 9.3.1 Static Lot-Sizing Procedures ............................................ 9.3.2 Periodic Lot-Sizing Procedures ........................................ 9.3.3 Optimum Lot-Sizing Procedures ...................................... 9.3.4 Lot-Size Restrictions ........................................................ 9.3.5 Additional Lot-Size Options ............................................ 9.3.6 Origin of the Lot-Size Settings ......................................... 9.3.7 Scrap Quantity Calculation .............................................. 9.4 Conclusion . ................................................................................. 229
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10 Safety Stock Planning ............................................................... 253
10.1 The Purpose of Safety Stock ......................................................... 10.2 Uncertainties in Materials Planning . ............................................ 10.3 Selecting and Defining the Service Level ...................................... 10.3.1 Alpha Service Level ......................................................... 10.3.2 Beta Service Level ........................................................... 10.3.3 Defining the Service Level ............................................... 10.4 Safety Stocks and Multilevel BOMs . ............................................ 10.5 Safety Stock Planning in SAP ERP . ............................................... 10.5.1 Manually Maintained Safety Stock .................................. 10.5.2 Automatically Calculated Safety Stock ............................. 10.5.3 Safety Time ..................................................................... 10.5.4 Dynamic Safety Stock ...................................................... 10.6 Safety Stock Planning in SAP APO ............................................... 10.6.1 Static Standard Methods ................................................. 10.6.2 Dynamic Standard Methods and Extended Methods ....... 10.6.3 Extended Methods . ........................................................ 10.7 Conclusion . ................................................................................. 253
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Contents
11 Determining Sources of Supply ................................................. 287
11.1 Source Determination in SAP ERP . .............................................. 11.1.1 Overview of Procurement Types in SAP ERP .................... 11.1.2 Types of Special Procurement .......................................... 11.1.3 Sources of Supply for In-House Production . .................... 11.1.4 Sources of Supply for External Procurement .................... 11.2 Source Determination in SAP APO . ............................................. 11.2.1 Overview of Procurement Types ...................................... 11.2.2 Sources of Supply for In-House Production . .................... 11.2.3 Sources of Supply for External Procurement .................... 11.2.4 Validity of Sources of Supply ........................................... 11.2.5 The Source Determination Process .................................. 11.3 Conclusion . ................................................................................. 287
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12 Scheduling Parameters .............................................................. 323
12.1 Scheduling in SAP ERP . .............................................................. 12.1.1 Basic Date Scheduling for In-House Production ............... 12.1.2 Lead-Time Scheduling ..................................................... 12.2 Scheduling in SAP APO . ............................................................. 12.2.1 SAP APO Scheduling for In-House Production . ............... 12.2.2 SAP APO Scheduling for External Procurement ............... 12.3 Conclusion . ................................................................................. 324
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13 Interactions . .............................................................................. 349
13.1 Parameter Dependencies ............................................................. 349
13.2 Relationship Model of Parameter Optimization . .......................... 353
13.3 Conclusion . ................................................................................. 356
Part III Materials Planning Optimization
14 Processing Materials Planning Results ..................................... 359
14.1 Tasks of the MRP Controller and SAP System Support .................. 359
14.1.1 Master Data Maintenance ............................................... 360
14.1.2 Qualitative Versus Quantitative Materials Planning ......... 360
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Contents
14.2 Materials Planning Controlling ..................................................... 14.2.1 MRP List and Stock/Requirements List ............................ 14.2.2 Standard Analyses ........................................................... 14.3 Personal Settings ......................................................................... 14.3.1 Filters . ............................................................................ 14.3.2 Navigation Profiles and Favorites . ................................... 14.4 Exception Messages and Troubleshooting (Alert Monitoring) ....... 14.5 Conclusion . ................................................................................. 361
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15 Availability Check ...................................................................... 373
15.1 Availability Check in SAP ERP ...................................................... 15.1.1 Availability Check Against ATP Logic ............................... 15.1.2 Availability Check Against
Planned Independent Requirements . .............................. 15.1.3 Availability Check Against Product Allocations ................ 15.1.4 Availability Check Against Capacity ................................. 15.2 Availability Check in SAP APO ..................................................... 15.2.1 Combination of Basic Methods ....................................... 15.2.2 Rules-Based ATP Check ................................................... 15.2.3 Capable to Promise (CTP) ................................................ 15.2.4 Multilevel ATP Check ...................................................... 15.3 Conclusion . ................................................................................. 373
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16 Collaborative Materials Planning Procedures ........................... 387
16.1 Vendor-Managed Inventory (VMI) ............................................... 16.1.1 The Traditional VMI Process with SAP ERP ...................... 16.1.2 The Extended VMI Process with SAP APO . ..................... 16.1.3 The VMI Process with SAP SNC
(Responsive Replenishment) . .......................................... 16.1.4 Evaluation of VMI ........................................................... 16.2 Supplier-Managed Inventory (SMI) .............................................. 16.2.1 SMI with Scheduling Agreement Delivery
Schedule Lines ................................................................ 16.2.2 SMI with Purchase Order Processing ............................... 16.2.3 Evaluation of SMI . .......................................................... 16.3 Conclusion . ................................................................................. 388
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Contents
17 Materials Planning with Kanban Control ................................. 405
17.1 The Pull Principle . ....................................................................... 17.2 Elements of Kanban Control ........................................................ 17.2.1 Kanban Control Cycle . .................................................... 17.2.2 Kanban Card ................................................................... 17.2.3 Kanban Board ................................................................. 17.2.4 Control Charts . ............................................................... 17.2.5 Determining Priorities in the Working System ................. 17.3 A Comparison of Kanban Control and
Conventional Production Planning ............................................... 17.4 Kanban Procedures ...................................................................... 17.4.1 Classic Kanban ................................................................ 17.4.2 Event-Controlled Kanban ................................................ 17.4.3 One-Card Kanban ........................................................... 17.4.4 Kanban with Quantity Signal ........................................... 17.5 The Kanban Process ..................................................................... 17.6 Automatic Kanban Calculation . ................................................... 17.7 Procedure for Selecting Products Suitable for Kanban .................. 17.8 Conclusion . ................................................................................. 405
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18 Inventory Controlling ................................................................ 425
18.1 Why Inventory Monitoring? . ....................................................... 18.2 Introduction to Logistics Controlling ............................................ 18.2.1 Statistical Differentiation of Key Figures .......................... 18.2.2 Business-Related Differentiation of Key Figures ............... 18.2.3 Logistics Costs and Costs of Materials Planning ............... 18.3 Problems with Data Collection . ................................................... 18.4 Important Inventory Key Figures .................................................. 18.4.1 “Range of Coverage” Key Figure ...................................... 18.4.2 “Inventory Turnover” Key Figure ..................................... 18.4.3 “Slow-Moving Items” Key Figure . ................................... 18.4.4 “Stock Value” Key Figure . ............................................... 18.4.5 “Dead Stock” Key Figure ................................................. 18.4.6 “Average Stock,” “Consumption,” and
“Range of Coverage” Key Figures .................................... 18.4.7 “Receipt Value of Valuated Stock” Key Figure ................. 425
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Contents
18.5
18.6
18.7
18.8
18.4.8 “Safety Stock Buffer” Key Figure .................................... 18.4.9 “Safety Stock” Key Figure .............................................. 18.4.10 “Service Level” Key Figure ............................................. 18.4.11 “Stock at Receipt” Key Figure ........................................ 18.4.12 “Lot Size” Key Figure ..................................................... Tools for Inventory Analysis ......................................................... 18.5.1 LMN Analysis ................................................................ 18.5.2 Flowcharts for Material Flow Analysis ............................ 18.5.3 Procurement and Consumption Cycles ........................... Inventory Monitoring in SAP ERP ................................................ Inventory Controlling with SAP APO and SAP NetWeaver BW ..... 18.7.1 Options for Evaluating Inventory Information ................ 18.7.2 Overview of SAP NetWeaver BW ................................... 18.7.3 Using Business Content . ................................................ Conclusion . ................................................................................. 447
448
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19 Materials Planning Optimization .............................................. 481
19.1 Classic Problems and Optimization Potential . .............................. 19.1.1 Lack of Knowledge and Insufficient Use of the
Standard SAP System ..................................................... 19.1.2 Stock Problems Caused by Incorrect Order
Progress Messages ......................................................... 19.1.3 Stock Problems Caused by Backlogs ............................... 19.1.4 Weaknesses of Parameterization in SAP ERP .................. 19.2 Example of the Process Flow of an Optimization Project .............. 19.2.1 Step 1: Master Data and Process Analysis According
to ABC/XYZ ................................................................... 19.2.2 Step 2: MRP Training ..................................................... 19.2.3 Step 3: Classifying and Creating the Set of Rules ............ 19.2.4 Step 4: Migration and Continuous Optimization ............ 19.3 Product Classification . ................................................................. 19.3.1 Decision-Making Support for MRP Controllers . ............. 19.3.2 MRP Matrix ................................................................... 19.3.3 Effects of Classification on Planning ............................... 19.4 Optimization Tools from SAP Consulting ...................................... 19.4.1 MRP Monitor ................................................................ 19.4.2 Replenishment Lead Time Monitor (RLT Monitor) ......... 481
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19.4.3 “MRP Optimization” Expert Tool ..................................... 515
19.4.4 Forecast Monitor ............................................................ 517
19.5 Conclusion . ................................................................................. 519
20 Outlook . .................................................................................... 521
Appendices ...................................................................................... 525
A Literature .............................................................................................. B Materials Planning Parameters and Influencing Factors . ........................ B.1 Planning Strategy ......................................................................... B.2 Materials Planning Type ............................................................... B.3 Forecast Method ......................................................................... B.4 Lot-Size Procedure ....................................................................... B.5 Safety Stock ................................................................................. C Materials Planning Optimization — Four Steps for Implementation
with the Support of SAP Consulting ...................................................... C.1 Introduction ................................................................................ C.2 “Materials Planning Optimization” Service Offering ..................... C.3 Objectives of the “Materials Planning Optimization” Service
Offering ....................................................................................... C.4 Contents During the Implementation . ......................................... C.5 Procedure When Implementing the Ser­vice Offering .................... C.6 Results of Service Offering ........................................................... D Add-Ons for SAP ERP . .......................................................................... D.1 Forecast Monitor ......................................................................... D.2 MRP Monitor .............................................................................. D.3 Replenishment Lead Time Monitor .............................................. D.4 Simulating Safety Stocks .............................................................. D.5 Service Level Monitor .................................................................. E The Authors .......................................................................................... 527
529
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Index .......................................................................................................... 555
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Materials Planning Process in SAP
Planning (SNP). SNP makes it possible to create a network-wide plan that uses inplant production, a stock transfer from another production plant or the procurement
of components or raw materials to cover the planned independent requirements of
demand planning and any sales orders that have already been placed. In this way, it
takes account of any capacity restrictions associated with the network. This function
isn’t available in SAP ERP.
The second step in materials planning, quantity planning, can be performed in either
SAP ERP or SAP APO. In a typical scenario involving integrated production planning,
demand-driven materials are planned in SAP APO, and consumption-based materials
are planned in SAP ERP. Once again, the planning run and the transparency associated
with the procurement situation in the SAP APO system offers some benefits over the
SAP ERP system.
Furthermore, scheduling and capacity requirements planning, which is integrated
directly into materials requirements planning, can be executed in either the SAP ERP
or SAP APO system. However, if the purpose of this step is to achieve a finite production plan, the enhanced capacity requirements planning options in SAP APO far outweigh SAP ERP. The SAP APO system provides the functions of the capacity planning
table, detailed scheduling heuristics, and the optimizer. SAP ERP, on the other hand,
has limited options in terms of finite detailed scheduling.
The step for order conversion and monitoring, that is, subsequent processing of external procurement and manufacturing orders, takes place in the Procurement and Manufacturing areas of the SAP ERP system; that is, in Materials Management (MM), Production Planning (PP), and, if necessary, in an integrated PDC system.
Even though SAP APO is purely a planning tool, any malfunctions and time shifts in
production are also considered here.
4.3
Materials Planning Process in SAP ERP
In this section, we’ll describe a materials planning process that only involves an SAP
ERP system. We’ll show you the SAP ERP functions available for each of four steps
described earlier.
4.3.1
Program Planning
Entering planned independent requirements as part of demand planning, entering customer independent requirements based on sales orders in Sales and Distribution (SD),
and the interaction of requirement types defined in the planning strategy are also steps
within program planning in SAP ERP.
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Materials Planning Process in SAP ERP
4.3
Demand planning
In SAP ERP, Sales and Operations Planning (SAP SOP) is available as an instrument for
supporting the process of sales and operations planning. SAP SOP produces requirement forecasts at the distribution center or production plant level, which can be later
transferred to materials planning. Forecast and planning can be based on historical,
existing, and estimated future data.
SAP SOP comprises two application components:
EE
Standard sales/operations planning (short form: standard SAP SOP)
EE
Flexible planning
Standard SAP SOP is, to a large extent, preconfigured when the system is delivered
and can be used without much effort. However, its functions are limited to the standard system. In flexible planning, on the other hand, businesses can customize many
of the functions provided. As a result, it provides numerous options for adjusting
demand planning to customer-specific planning (see Table 4.2), which facilitates planning at every organizational level and determines the content and layout of the planning screens.
Flexible Planning
Standard SAP SOP
Numerous options for a customized
configuration
Largely preconfigured
Planning hierarchies
Product groups
Consistent planning or level-by-level
planning
Level-by-level planning
Planning type used to configure the
content and layout of the planning table
Standard planning table
Table 4.2 Differences Between Flexible Planning and Standard SOP
In demand planning, forecasts are usually based on aggregated historical data, which
can, for example, come from SAP ERP-LIS (Logistics Information System). The corresponding data structures in LIS are used to structure and prepare the plan figures. They
are based on the use of characteristics (e.g., plant and sold-to party) that can be used to
break down key figures (e.g., production quantity).
Demand planning can be the starting point for the entire production planning process.
For example, production plans can be created within demand planning (e.g., in a production key figure) and later transferred to operative planning as planned independent
requirements. Because of this, the planned independent requirements form the basis
for procurement planning and production planning and can, for example, be offset
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4
Materials Planning Process in SAP
against the current sales orders, depending on the chosen planning strategy. This process is shown again in Figure 4.3.
LIS
Sales Organization
Sold-to Party
Material
Plant
Demand Plans
Demand Planning
Production Plans
Operative Planning
Material
Plant
Planned Indep. Req.
Planned Orders
Quantity and Dates
Purchase Requisitions
BOM Explosions
Capacity Requirements for Work Centers
Program Planning
Requirements
Planning
Figure 4.3 Demand Planning Process
Planning Strategies in Program Planning
As already described in Section 4.1.1, Program Planning, independent requirements
come from planned independent requirements and real sales orders. We’ll now define
the interaction of such independent requirements in program planning within the SAP
ERP system. How independent requirements behave in requirements planning (i.e.,
whether they affect requirements and whether they are offset against other requirements) is determined by their requirement type or planning strategy (see Figure 4.4).
Planned independent requirements are stock requirements that have been derived
from a forecast of the future requirements situation. In make-to-stock production, you
want to initiate procurement of the relevant materials without having to wait for actual
sales orders. Such a procedure can shorten delivery times and, thanks to future-oriented planning, evenly spread the burden across the production resources.
SD employees enter customer independent requirements (sales orders). Depending
on the requirement type that has been set, customer requirements can flow directly
into requirements planning. This is always desired if a business wants to implement
customer-specific planning. Sales orders can be used as a sole source of requirements
for which procurement is specifically triggered (make-to-order production), or they,
together with planned independent requirements, can represent the total requirement.
It is also possible to offset sales orders against planned independent requirements.
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Materials Planning Process in SAP ERP
4.3
Production Program
Demand Planning
Forecasts
Planned Indep. Req.
Offset according
to Planning
Strategy
Customer
Requirements
Sales Orders
from SD
Requirements Planning
Meeting Requirements by
� In-House Production
� External Procurement
� Stock Transfers within Internal Network
Figure 4.4 Independent Requirements in the Demand Program
The SAP ERP system provides the following basic strategies for creating the demand
program:
EE
Make-to-stock production
Production as a result of make-to-stock planning, requirements fulfilled from the
warehouse
EE
Subassembly planning
Planning-based make-to-stock production for assemblies
EE
Order-related production
Make-to-order production of finished products and, if necessary, make-to-stock production of assemblies
If make-to-stock production strategies are used, production usually takes place without
sales orders having to already exist for the material in question. After sales orders are
received, the goods can be delivered from the warehouse, thus making it possible to
implement short delivery times. Make-to-stock production also gives rise to the most
even production run, irrespective of the current demand.
Make-to-stock production can also take place for assemblies. In this case, the finished
product itself isn’t produced in storage, but only the required assemblies are procured.
This generally makes it possible to quickly fulfill a sales order for a finished product
because all that remains is final assembly (the assemblies are already available).
For sales-order-related production, there is no planning in the actual sense; instead,
procurement doesn’t take place until an actual sales order exists. Often, make-to-order
production is used with subassembly planning for components to keep delivery times
to a minimum.
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Materials Planning Process in SAP
4.3.2
Quantity Planning
Quantity planning is used for production planning, external procurement, or stock
transfers from other plants using existing in-plant requirements (depending on the procurement type). That is, the requirements are covered by creating planned orders (for
in-house production planning) as well as purchase requisitions or schedule lines (for
external procurement planning). Production planning concludes when planned orders
are converted into manufacturing orders (production order or process order) or into
purchase orders or schedule lines.
Planning can be consumption-based (e.g., by specifying a reorder point) or demanddriven. For each material, the basic type of materials planning is defined with the MRP
type, which is entered on the Materials Planning 1 tab of the material master. The
MRP type can also be used to exclude a material from materials planning. Figure 4.5
provides an overview of the MRP procedure in SAP ERP.
MRP Procedures
Material Requirements
Plangesteuerte Disposition
Planning
Consumption-Based
Planning
Verbrauchsgesteuerte Disposition
No or Manual Planning
Reorder Point Planning (s,q or s,S Rule)
Time-Phased Planning (t,q or t,S Rule)
Forecast-Based Planning
Figure 4.5 Overview of MRP Procedure in SAP ERP
MRP is based on current and future sales and takes place across the entire BOM structure (see Figure 4.6).
EE
The planned requirement quantities (in the form of planned independent requirements or sales orders) trigger requirements calculation.
EE
MRP essentially uses backward scheduling in which the required start dates are
determined from a preassigned end date.
EE
The procurement proposals for the finished product are created, and BOM explosions are used to determine the dependent requirements for the components. The
dependent requirement date is determined from the start date of the source planned
order.
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Materials Planning Process in SAP ERP
EE
4.3
Starting with the dependent requirement date as the availability date, the order
dates for the components are determined in backward scheduling using the inhouse production time or the planned delivery time.
Requirement
BOM
When will
production take place?
A
B
Planned Order for
Finished Product A
C
Oper. 10
Oper. 20
Oper. 30
Dependent
Requirements
Planned Order for Assembly B
Oper. 10 Oper. 20 Oper. 30 Oper. 40
Today
When will the
components be needed?
Purchase Order for
Raw Material C
Time
When does procurement have to begin?
Figure 4.6 Planning Process in Multilevel MRP
In MRP, a net requirements calculation is performed during the planning run to determine whether there is a material shortage. For this purpose, the stock and existing
firmed receipts (e.g., purchase orders, fixed purchase requisitions and production
orders, and planned orders) are compared against the safety stock and the requirements. The result of this comparison is known as the quantity available for MRP. If
the quantity available for MRP is lower than zero, this is known as a material shortage. Requirements planning responds to material shortages by creating new procurement proposals. Here, the procurement type determines whether the system creates
purchase order requisitions or planned orders. The proposed procurement quantity is
based on the lot-sizing procedure set in the material master (see Figure 4.7).
Consumption-based planning, on the other hand, is based on historical consumption
values and uses forecasts or statistical procedures to predict the future requirement.
Consumption-based planning is characterized by its simplicity and is principally used
for low-value B and C items.
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4
Materials Planning Process in SAP
Lot Size of
Procurement Proposal
Material
Shortage
Sales Orders
Planned Indep. Req.
Firmed Receipts
Dependent Requirements
Purchase Orders
Within the
Rescheduling
Period
Requirements
Reservations
Production Orders
etc.
etc.
Fixed Planned Orders
Fixed Purchase Requisitions
Safety Stock
Inventory
Figure 4.7 Net Requirements Calculation
Inventory
Manual reorder point planning, shown in Figure 4.8, is a typical procedure in consumption-based planning. Materials planning is controlled by a manually specified
reorder point (e.g., 50 pieces). During the planning run, the system checks whether
or not stock has fallen below this reorder point (i.e., whether there are fewer than 50
pieces in storage). If so, procurement is triggered for the lot-size amount (e.g., a fixed
lot size of 500 pieces). This procedure corresponds to the s,q reorder method described
in Section 4.1.2, Quantity Planning.
Lot Size
Reorder Point
Safety Stock
Reorder Point
Time of Delivery
Time
Replenishment Lead Time
Figure 4.8 Consumption-Based Planning
4.3.3
Scheduling and Capacity Requirements Planning
During quantity planning, the routing can be used to calculate the capacity requirements resulting from the planned orders. As a prerequisite for this calculation, you
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MaterialsPlanningProcessinSAPERP
4.3
must select Lead Time Scheduling and Capacity Planning as Scheduling parameter 2 for
the MRP planning run (see Figure 4.9). Only then is the routing used to schedule the
operation dates in addition to the basic dates for planned orders.
Figure 4.9
Scheduling Parameters for the MRP Planning Run
In the first step, infinite requirements planning creates capacity requirements only.
These are scheduled by using the times defined in the routing and by accepting infinite
capacities. Initially, the system doesn’t check whether the work center is still available
for the required dates.
In the second step, it must perform a check to determine whether planning is possible from a capacity perspective. This check takes place during capacity requirements
planning, which is usually based on a particular work center. The goal of capacity
requirements planning is to schedule all operations for planned orders or manufacturing orders in such a way that the production plan can be fulfilled. Scheduling may
cause dates to shift.
The functions of capacity evaluation are then used to determine available capacities and
capacity requirements and to compare them against each other in lists or charts. Subsequent capacity leveling can be used to level overloads and underloads in work centers;
the best deployment sequence for machines and productions lines can be determined
here and suitable resources chosen. The tabular and graphical planning tables can be
used to schedule operations so that they can be implemented within capacity planning
(see Figure 4.10).
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4
MaterialsPlanningProcessinSAP
Figure 4.10 Graphical Planning Table in SAP ERP
Here, you can also note a particular rule for the scheduling sequence. If work centers
have several individual capacities, they can be assigned and split into these individual
capacities. However, it’s considerably more helpful to create a finite production plan
in the SAP APO system because it has an optimizer and scheduling heuristics (for more
information, see Section 4.4.3, Production Planning and Detailed Scheduling).
4.3.4
Order Conversion and Monitoring
Production control commences as soon as a planned order is converted into a production order. Planned orders can either be converted manually by the planner or using
a release period via collective processing. As you can see in Figure 4.11, a production
order in SAP ERP passes through a number of phases.
The activities marked with an asterisk (*) can be automated or processed in the background, which minimizes the manual effort for order management. Work-in-progress
(WIP) calculations, deviation recording, and settlement are usually periodic cost object
controlling tasks that are processed in the background. The following are important
basic production order functions in SAP ERP:
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Materials Planning Process in SAP ERP
4.3
Order Creation
1
Archive/Delete
Order Settlement
Order Opening
2
17
3 Availability Checks *
16
Deviation
Determination 15
4
Lifecycle
of a
Production Order
Goods Receipt * 14
5
Machine Utilization
Order Release *
6 Download to PDC System
Work-in-Progress 13
Determination
7 Order Printout *
12
Confirmation *
8
11
Upload from PDC System
10
9
Material Staging
Material Consumption Posting *
Figure 4.11 Lifecycle of a Production Order in SAP ERP
EE
Status management
EE
Scheduling
EE
Calculation of capacity requirements
EE
Costing
EE
Availability check of components, production resources/tools, and capacities
EE
Printing shop floor papers
EE
Material staging via reservations
EE
Confirmation of quantities, services, and time events (variable confirmation
procedures)
EE
Goods receipt
EE
Period-end closing (process cost allocation, overhead rates, WIP calculations, deviation recording, and order settlement)
A production order must be released before production can begin. As soon as this happens, goods movements can be posted for the order, papers printed, confirmations
entered, and an automatic availability check performed. The system can perform this
availability check for material components, capacities, and production resources/tools.
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4
Materials Planning Process in SAP
Confirmations are used to record production progress. They provide the basis for progress tracking and subsequent capacity requirements planning. For this reason, accurate,
almost real-time confirmations are important. At the same time, order confirmation is
used to record internal services that have been performed for the order. Confirmations
are generally made in the SAP ERP system, and they trigger various functions (see Figure 4.12).
Order
Status
Quantity
Actual Cost
Automatic
Goods Receipt
Update of
Statistical Data
(LIS, BW)
Confirmation
Backflush
Actual Cost
HCM
Data Transfer
Reduction of
Capacity
Requirements
Figure 4.12 Confirmation Functions
EE
Each confirmation is recorded with a status (e.g., partially confirmed or confirmed).
EE
The confirmed quantity and actual cost are written to the production order.
EE
A confirmation can occur with an automatic goods receipt.
EE
Material withdrawals can also be posted automatically, using a backflush.
EE
The confirmation also reduces the capacity requirements of the production order.
If goods receipt and goods issue postings are not coupled with a confirmation, they
must be posted manually. These postings are critical for the quality of materials planning because they provide for changes in stock and a reduction in reservations.
4.4
Materials Planning Process in SAP APO
This section describes the following SAP APO functions: Demand Planning (DP), Supply Network Planning (SNP), and Production Planning and Detailed Scheduling (PP/DS).
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Index
3D classification, 498
3D graphic, 74
3D matrix, 498
A
ABC analysis, 55, 56, 61, 63, 77, 90, 421, 492
A Materials, 58
B Materials, 59
C Materials, 60
D Materials, 60
Evaluating, 74
For warehouse optimization, 77
Quantity flow analysis, 79
ABC segmentation, 75
ABC strategy parameter, 69
ABC/XYZ analysis, 51, 92, 420
ABC/XYZ classification, 96, 486, 495, 510
ABC/XYZ matrix, 55, 83, 90, 93, 492
Ability to deliver, 454
Absolute percentage error (APE), 194
Accepted delivery time, 500
Access fluctuation, 62
Accumulate balances, 30
Activity, 340
Activity relationship, 341
Activity scrap, 250
Actual delivery time, 454
Additional requirement, 31
Adherence to desired delivery date, 320
Adjustment of historical data, 199
Alerting, 175
Alert Monitor, 59, 369
Alpha factor, 190
Analysis goal, 64
Analysis of slow-moving items, 366, 443
Area to analyze, 64
Assemble-to-order, 44
Assembly level, 42
Assembly processing, 155
Assembly scrap, 241, 250
Assignment mode, 168
ATP check
Multilevel, 384
Rules-based, 382
ATP tree structures, 322
Automatic model selection, 2, 180, 181
Automatic model selection procedure 1, 181
Availability check, 103, 373
Against ATP logic, 373
Against capacity, 380
Against planned independent requirements,
379
Against product allocations, 380
Logic, 373
Availability overview, 379
Available capacity, 333
Available stock, 206, 212
Available to promise (ATP) → Availability
check, 373
Avoid delays, 222
Avoid surpluses, 221
B
Backlogs, 484
Barcode, 407, 408
Base value, 189
Basic date, 324, 330, 337, 338
Basic date scheduling, 324, 327, 330, 335,
336, 338, 339
Across BOMs, 329
Basic finish date, 324, 326, 329, 331, 335
Basic start date, 324, 326, 329, 336, 337
Bestandsanalyse, 457
Beta factor, 190
BEx Analyzer, 475
B Materials, 59
BOM selection, 297
Bulk material, 133
Bullwhip effect, 387
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Index
C
Capable to match (CTM), 118, 224
Capable to promise (CTP), 103, 121, 224, 381,
382, 385
Capacity evaluation, 111
Capacity leveling, 111
Capacity requirement, 333, 338
Capacity requirements planning, 101, 111
Causal forecasting, 184
Characteristics planning, 156
Checking group, 374
Checking rule, 375
Check mode, 168
CIF → Core Interface, 102
Classification, 491
Enhanced, 499
Class limit, 70, 71
C Materials, 60
Collaborative Planning, Forecasting and
Replenishment (CPFR), 387
Combination of basic methods, 381
Component scrap, 241
Composite forecasting, 185
Configurable materials → Variant
configuration, 156
Confirmation, 102, 114
Confirmation date, 373
Consignment, 133, 295, 312, 388
Consignment scheduling agreement, 319
Consignment stores, 134
Constant model with first-order exponential
smoothing, 177
Consumption, 137
Consumption cycle, 460
Consumption mode, 141
Consumption parameter, 45, 141
Consumption period, 141
Consumption range of coverage, 437
Contract, 300, 311, 314, 319, 345
Control cycle, 416
Control key, 332, 340
Co-product, 243
Core Interface, 102
Core Interface (CIF), 128, 168
Cost function, 319
Costs for external services, 434
Costs for load carriers, 434
Costs for operating facilities, 433
Croston method, 180
Customer independent requirements, 99
D
Data basis
Calculating, 67
Data collection, 435
Data processing costs, 434
Data quality, 197
Date adjustment, 337
Daysí supply, 94
Dead stock analysis, 94, 364, 444
Decision-making process, 491
Decision-making support, 491
Decision tree, 502
Delivery reliability, 452, 453, 454
Delivery service, 454
Delivery time, 329
Delta factor, 190
Demand management, 197
Demand Planning (DP), 103, 105, 115, 175
Demand program, 28
Demand range of coverage, 437
Demand source, 406, 410, 411, 414
Dependent requirement, 28, 31, 100
Destination location, 316, 345
Detailed scheduling, 101
Detailed Scheduling (DS), 120
MRP-based, 122
Determination of requirements, 27, 61, 173
Deterministic, 27, 28, 30
Forecast-based, 29
Order-based, 30
Direct procurement, 295
Direct production, 291
Display filter, 363
Disposal logistics, 432
Distribution key, 329
Distribution logistics, 432
556
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Index
E
G
Early warning system, 67
Efficient Consumer Response, 387
Engineer-to-order, 43, 44
Enterprise-specific factor, 354
Enterprise structure, 354
Error level → Forecast error, 192
Error total (ET), 192
Exception, 67
Exception message, 369
Execution time, 332
Explosion date, 320
Ex-post forecast, 189
External procurement relationship, 311, 319,
345
Gamma factor, 190
Geometric mean of the relative absolute error
(GMRAE), 196
Global parameter, 310
Goods receipt processing time, 325, 329, 342,
344, 378
Groff reorder procedure, 236, 246
Gross requirement, 30, 31, 100
Gross Requirements Planning (Strategy 11),
144
F
FIFO valuation procedure, 221
Fill rate, 453
Filter, 367
Filter function, 369
Final assembly
By sales order, 143
Fixed procurement costs, 501
Float after production, 330, 335, 339
Float before production, 330, 335, 339
Flowchart, 458
Fluctuating demand, 422
Fluctuation coefficient, 62
Forecast, 117, 173, 351
Forecast controlling, 175
Forecast distribution, 201
Forecast error, 192
Forecasting accuracy, 192, 261
Forecast method, 536
Forecast monitor, 517
Forecast parameters, 187
Forecast result, 197
Formula parameter, 332, 341
Fulfillment rate, 426
H
Handling resource, 342
Heuristic, 121
I
Inbound delivery modality, 26
Independent requirement, 28, 30, 99
Individual/Collective Requirements indicator,
152
Individuality, 499
Influencing factors, 529, 532
Info record, 345
Information system, 428
InfoSource, 472
In-house production time, 324, 326, 329,
330, 335, 337, 339, 378
Lot-size dependent, 324
Lot-size independent, 324
Initialization period, 188
Interaction, 349
Interactions, 491
Interactive planning, 319
Interoperation time, 324, 333, 341, 343
Inventory Aging Analysis, 476
Inventory controlling, 63, 75, 425, 461
Inventory costs, 433
Inventory key figures, 436
Inventory Monitoring, 461
Inventory strategy, 26
Inventory-taking, 61
557
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Index
Inventory turnover, 366
Item classification, 47, 51, 56, 88, 424
J
Joint forecasting, 387
K
Kanban, 405
Board, 409, 414
Card, 405, 408
Classic, 410
Container, 419
Contol, 407
Control cycle, 407, 408
Event-controlled, 411
One-card, 411
Procedure, 410, 423
Signal, 406, 410, 414
Status, 413
With quantity signal, 412
Kanban calculation
Automatic, 416, 418
Key figures, 174, 363
Average consumption, 445
Average range of stock, 445
Average stock, 445
Business-related, 428
Consumption, 445
Dead stock, 444
Definition, 427
Descriptive, 428
Inventory turnover, 441
Lot size, 456
Normative, 428
Profitability, 429
Range of coverage, 436, 445
Receipt value of valuated stock, 447
Safety stock, 448
Safety stock buffer, 447
Service level, 450
Slow-moving items, 442
Statistical, 427
Stock at receipt, 456
Stock factor, 448
Stock value, 443
Key for performance efficiency rate, 333
L
Last lot
Exact, 240
Lead time scheduling, 101, 111, 324, 330,
338, 339, 344
Across BOMs, 336
Least unit cost procedure, 236
External procurement, 223
Least-unit cost procedure
External procurement, 247
Licenses and other rights, 435
Linear exponential smoothing, 177
Linear regression, 179
Liquidity key figure, 428
LMN analysis, 457, 497
Location group, 334
Logistics controlling, 425, 426, 461
Logistics costs, 431, 432
Logistics Information System (LIS), 59, 105
Lorenz curve, 57
Lot size, 26
Fixed, 234, 243
Lot-for-lot order quantity, 234, 239, 243
Maximum, 237, 240, 248
Lot-size calculation, 100, 229
Lot size creation
Dynamic, 236
Lot-size procedure, 540
Lot-size restriction, 237, 248
Lot-sizing parameters, 45
Lot-sizing procedure, 352
Optimum, 232, 235, 245
Periodic, 234, 244
Static, 234
Lot-sizing restriction, 233
Low-level code, 100
Low-level coding, 28
558
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Index
M
Make-to-order, 28, 44
Make-to-order production (strategy 20), 30,
143, 151
Make-to-stock, 43
Make-to-stock production, 41, 143
Customer-independent, 41
Make-to-Stock Strategy, 142
MASSD, 131
Mass maintenance, 131
Master data, 481
Master Data and Process Analysis, 486
Master data concept, 198
Master data maintenance, 360
Master production scheduling, 214
Material BOM, 308
Material Flow Analysis, 458
Material flow control, 405
Material grouping, 64
Material master planning, 173
Material planning parameters, 529
Material posting, 206
Material range of coverage, 438
Material requirements explosion, 26
Material requirements planning (MRP), 28,
406, 409
Materials
Configurable, 156
Materials Planning → s. Material requirements
planning, 28
Advantages and disadvantages of
centralized and decentralized, 53
Consumption-based planning, 27, 29, 100,
108, 203
Forecast-based, 324, 326, 329, 332, 335
Forecast-based planning, 28, 208
Material requirements planning, 28, 100,
108, 203, 324, 326, 329, 332, 335
Mixed procedure, 38
MRP, 212
Operational, 49, 50
Optimization, 388, 399
Order-based planning, 28
Qualitative, 360
Quantitative, 360
Strategic, 49, 50, 51
Tasks, 49
Time-phased materials planning, 28, 211
Materials planning controlling, 361
Materials planning decision, 495
Materials planning master data
General, 127
Materials planning optimization, 94, 481
Materials planning results
Processing, 359
Materials planning type, 534
Matrix organization, 51, 53, 54
Mean absolute deviation (MAD), 189, 193,
261
Mean absolute percentage error (MAPE),
195
Means of transport, 345
Mean square error (MSE), 193
Mean value, 81
Median of the absolute percentage error
(MdAPE), 196
Migration, 489
Minimum lot size, 237, 248
Minimum stock level, 265
Mixed procedure, 38
Mode, 340
Model initialization, 188
Models with second-order exponential
smoothing, 179
Monitor of deliveries, 455
Move time, 334, 341, 343
Move time matrix, 334, 344
Moving average, 176
MRP group, 131
MRP list, 363
MRP matrix, 489, 504, 515
MRP monitor, 90, 510
MRP parameter, 127
Hierarchy, 351
MRP procedure, 27, 108, 203
MRP profile, 132
MRP strategy, 26, 42, 44, 47, 50
MRP training, 487
MRP type, 203, 351
Multiple linear regression (MLR), 185
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Index
N
P
Navigation profile, 368
Negative lead time, 336
NetChange, 239
NetPL, 239
Net requirement, 30, 32, 100
Net requirements calculation, 26
Normal scheduling agreement, 319
Parameterization, 485
Parameter optimization
Relationship model, 353
Parameter settings, 529
Part period balancing, 223, 236, 246
Part provided, 328
PDS BOM, 309
Pegging area, 222
Period factor, 244
Period of adjustment, 160
Periods per seasonal cycle, 189
Period to analyze, 64
Personnel costs, 434
Phantom assembly, 146, 289, 309
Plan explosion, 310
Plan Monitor, 465
Planned delivery time, 327, 329, 346, 378
Planned independent requirements, 41, 99
Adjust and reorganize, 160
Reduce, 159
Planned order conversion, 337
Planning, 173, 508
Flexible, 102, 105, 174
Without Final Assembly, 149
Planning application, 315, 319, 320
Planning at assembly level, 45
Planning calendar, 235
Planning file, 216
Planning for Assemblies Without Final
Assembly (Strategy 74), 151
Planning for Phantom Assemblies (Strategy
59), 146
Planning horizon, 50
Planning level, 99, 116
Planning material, 152
Planning plant, 290
Planning profile, 157
Planning-relevant event, 215
Planning run, 362
Planning strategy, 106, 136, 350, 529
Planning with a Planning Material and
Without Make-to-Order Production (Strategy
63), 152
O
One piece flow, 405
On-time delivery, 453, 454
On-time delivery performance, 315, 320
Opening date, 326
Opening period for planned order, 326, 329
Open order, 454
Operating time, 332
Operation date, 335
Operation scrap, 241
Operation segment, 332
Operation time, 332
Optimization potential, 84, 481
Deriving, 84
Optimization project, 486
Process flow, 486
Optimization tool, 486, 496, 497, 510
Order conversion, 102
Order cycle, 61
Order float, 330, 335, 339
Order monitoring, 102
Order opening date, 324
Order progress messages, 482
Order release, 102
Organizational structure
Centralized, 51
Corporate group, 53
Decentralized, 51
Large business, 52
Medium-sized business, 51
Outlier correction, 190
Outline agreement, 300
560
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Index
Planning with a Planning Material (Strategy
60), 155
Planning with Final Assembly (Strategy 40),
145
Planning Without Final Assembly (Strategy 50
and Strategy 52), 149
Plant maintenance, 76
Pool, 68
Portfolio matrix, 80
Positive lead time, 329, 336
PP/DS optimizer, 121
PP procedure, 214
Prediction ability, 62
Preproduction and setup costs, 434
Primary resource, 340
Process control heuristic, 220, 226
Procurement costs, 245, 318
Procurement cycle, 460
Procurement logistics, 431
Procurement market research, 60
Procurement planning
External, 307
Procurement priority, 318
Procurement quantity calculation, 229, 242
Procurement type, 287, 307, 312, 319
Product allocation, 373
Product classification, 491
Product group, 55
Product heuristic, 214, 217, 220, 317
Production, 76
Production by Lot Size (Strategy 30), 144
Production data structure (PDS), 308, 309,
318, 340
Production in alternative plant, 289, 310
Production in an alternative location, 310
Production logistics, 432
Production order, 112, 483
Production order conversion, 338
Production order creation, 326
Production planning, 120
Production plant, 290
Production process model (PPM), 309, 318,
340
Production type, 41
Select, 41
Productivity key figure, 429
Product lifecycle, 86, 422
Product phase-in and phase-out, 422
Product type, 499
Profitability key figures, 428
Program planning, 98, 104
Pull principle, 405, 424
Pull strategy, 99
Purchase Order Calculation → s. Reorder
policy, 32
Purchase order limit, 33
Purchase order period (t), 33
Purchase order quantity (q), 33
Purchasing, 75
Purchasing department processing time, 328,
329, 378
Purchasing info record, 311, 314, 319
Push principle, 406
Push strategy, 99
Q
Quality key figure, 429
Quantity flow analysis, 79
Quantity planning, 100, 108
Quantity signal, 413
Queue time, 333, 343
Quota, 317
Quota-allocated quantity, 317
Quota arrangement, 302, 316
Incoming, 316
Outgoing, 316
Quota arrangement header, 317
Quota base quantity, 317
Quota rating, 317
R
Range of coverage, 365
Analysis, 365
Calculation, 265
Profile, 265
Ranking list, 316, 319
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Index
Rate of capacity use, 332
Readiness to deliver, 452
Real estate and occupancy costs, 434
Receipt days‘ supply, 437
Receipt quantity, 70
Reclassification, 87
Reduction, 334, 337
Reduction in independent requirements, 159
Regression analysis, 189
Relationship, 341, 343
Relationship model of parameter
optimization, 353
Relative absolute error (RAE), 196
Relative indicators, 427
Release date, 329
Release modality, 26
Reorder cycle method, 33
Reorder method, 100
Reorder point(s), 204; → s. Purchase order
limit, 33
Reorder point lot-sizing policy, 36
Reorder point method, 28, 36
Reorder point planning, 204, 327, 329, 344,
352
Automatic, 205
Manual, 204
Reorder point system → s. Reorder point
method, 36
reorder point warehouse level policy, 37
Reorder policy, 32, 39
Replenishment lead time, 205, 438
Replenishment lead time (RLT), 377, 500, 514
Replenishment up to maximum stock level,
234, 243
Requirements calculation, 27
Requirements class, 135
Requirements list, 362
Requirement splitting, 317
Requirement strategy, 169
Requirements type, 136
Resource, 341
Responsive replenishment (RR), 391, 394, 396
Reuse mode, 216
Root of the mean square error (RMSE), 194
Rounding profile, 238, 248
Rounding value, 237, 248
Route and network costs, 434
Routing, 308
Routing selection, 298
S
Safety factor, 262
Safety stock, 55, 61, 93, 208, 253, 352, 543
Dynamic, 265
Manual, 259
Simulation, 449
Safety stock planning profile, 280
Safety time, 263, 269, 339
Sales and distribution, 75
Sales forecast, 42
Sales & Operations Planning (SAP SOP), 102,
105
Sales-order-related production, 41
SAP Consulting solution, 90
SAP_MRP_001, 220, 226
SAP_MRP_002, 220, 226, 227
SAP NetWeaver BW, 464
SAP_PP_002, 218, 221, 223, 225, 237, 240,
242, 320
SAP_PP_003, 223
SAP_PP_004, 223, 248
SAP_PP_005, 223, 246
SAP_PP_006, 223, 247, 321
SAP_PP_007, 224, 225
SAP_PP_012, 220
SAP_PP_013, 223, 246
SAP_PP_017, 242
SAP_PP_020, 227
SAP_PP_C001, 222
SAP_PP_Q001, 223, 317
SAP_PP_SL001, 222
Scheduling, 323
Scheduling agreement, 300, 311, 314, 345
Scheduling basis, 332, 340
Scheduling formula, 332, 340
Scheduling margin key, 326, 330, 335, 339
Scheduling parameter, 323
SCOR, 426
Scrap, 229, 233, 241, 250
Seasonal exponential smoothing, 177
Seasonal linear regression, 179
Seasonal trend exponential smoothing, 178
562
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Index
Selection rule, 363
Sequence planning, 101
Service heuristic, 220
Service level, 255, 262, 451, 500
Service Level Monitor, 454
Service parts logistics, 432
Set of rules, 487
Setup time, 324
Shortfall, 253
Sigma factor, 190
Slow-moving item, 366
Slow-moving item analysis, 94
SMI → Supplier-managed inventory, 388
SNP order, 322
Source determination, 216, 327
Automatic, 306
Source list, 301, 327
Source location, 345
Source of supply, 307
Special material, 133
Special process, 198
Special procurement key, 289, 310
Splitting, 239, 317
s.q policy → s. Reorder point lot-sizing policy,
36
s,S policy → s. reorder point warehouse level
policy, 37
Stage numbering algorithm, 227
Standard analysis, 363
Standard deviation, 81, 262
Standard value key, 332
Standard values, 332
Stock days‘ supply, 438, 478
Stocking level, 42, 99, 150
Stocking level determination, 42
Stock in transit, 293
Stock of material provided to vendor, 294
Stock transfer, 293, 312, 328, 348
Storage costs, 501
Storage range, 90
Storage volume analysis → LMN analysis, 497
Strategy profile, 321
Structure key figure, 429
Subassembly planning, 45
Subassembly Planning (Strategy 70), 145, 146,
151
Subcontracting, 293, 312, 328, 348
Supplier-managed inventory (SMI), 388, 399
Applications, 404
Evaluation, 403
With purchase order processing, 401
With scheduling agreement delivery schedule
lines, 399
Supply Chain Council, 428
Supply chain organization, 49
Supply Network Planning (SNP), 104, 117
Heuristic, 118
Optimizer, 119
Supply source, 406, 410, 415, 422
System group, 102
T
Takt time, 240
Target stock level, 33, 265
Target stock level method, 243, 245
Taxes, duties, insurance and other costs, 434
Tertiary requirement, 31
Total lead time, 460
Total replenishment lead time, 378
Totals curve, 74
Total usage quantity, 67, 68
Total usage value, 68
t,q policy, 33
Tracking signal, 191
Transportation lane, 311, 312, 345
Transport packaging and conservation costs,
434
Trend damping profile, 179
Trend value, 189
Troubleshooting, 369
t,S policy, 34
t,s,q policy, 38
t,s,S policy, 38
U
Uncertainty, 254
Univariate forecast models, 176
Update, 338
563
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Index
V
Valuated stock issue quantity, 67
Valuated stock receipt quantity, 67
Value analysis, 60
Variant configuration, 156
Variation coefficient, 81, 92
Vendor consignment, 295
Vendor-managed inventory (VMI), 388
Applications, 398
Direct delivery scenario, 390
Evaluation, 397
Extended process, 390, 392
Shops scenario, 390
Traditional process, 388, 390, 391, 395
W
Wait time, 334, 341, 343
Warehouse optimization, 77
Weighted moving average, 176
Weighting group, 176, 189
Whiplash effect, 387
Winters seasonal model, 177
Withdrawal from alternative plant, 290
X
XYZ analysis, 55, 61, 81, 421, 493
N material, 62
X material, 61
Y material, 61
Z material, 61
Y
Yield, 233
Y material, 61
Z
Z material, 61
564
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