SAP R/3 4.6 LO210 production planning

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Information about SAP R/3 4.6 LO210 production planning
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Published on October 7, 2014

Author: edfgaviria

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1. © SAP AG 1999 LO210 Production Planning Production PlanningProduction Planning „ System R/3 „ Release 4.6C „ September 2000 „ 5004 1851

2. © SAP AG 1999 Copyright 2000 SAP AG. All rights reserved. Neither this training manual nor any part thereof may be copied or reproduced in any form or by any means, or translated into another language, without the prior consent of SAP AG. The information contained in this document is subject to change and supplement without prior notice. All rights reserved. Copyright Trademarks: „ Some software products marketed by SAP AG and its distributors contain proprietary software components of other software vendors. „ Microsoft®, WINDOWS®, NT®, EXCEL®, Word® and SQL Server® are registered trademarks of Microsoft Corporation. „ IBM®, DB2®, OS/2®, DB2/6000®, Parallel Sysplex®, MVS/ESA®, RS/6000®, AIX®, S/390®, AS/400®, OS/390®, and OS/400® are registered trademarks of IBM Corporation. „ ORACLE® is a registered trademark of ORACLE Corporation, California, USA. „ INFORMIX®-OnLine for SAP and Informix® Dynamic ServerTM are registered trademarks of Informix Software Incorporated. „ UNIX®, X/Open®, OSF/1®, and Motif® are registered trademarks of The Open Group. „ HTML, DHTML, XML, XHTML are trademarks or registered trademarks of W3C®, World Wide Web Consortium, Laboratory for Computer Science NE43-358, Massachusetts Institute of Technology, 545 Technology Square, Cambridge, MA 02139. „ JAVA® is a registered trademark of Sun Microsystems, Inc. , 901 San Antonio Road, Palo Alto, CA 94303 USA. „ JAVASCRIPT® is a registered trademark of Sun Microsystems, Inc., used under license for technology invented and implemented by Netscape. „ SAP, SAP Logo, mySAP.com, mySAP.com Marketplace, mySAP.com Workplace, mySAP.com Business Scenarios, mySAP.com Application Hosting, WebFlow, R/2, R/3, RIVA, ABAP™, SAP Business Workflow, SAP EarlyWatch, SAP ArchiveLink, BAPI, SAPPHIRE, Management Cockpit, SEM, are trademarks or registered trademarks of SAP AG in Germany and in several other countries all over the world. All other products mentioned are trademarks or registered trademarks of their respective companies. „ Design: SAP Communications Media

3. © SAP AG 1999 Production Planning Level 2 Level 3 Manufacturing Planning & Execution for Discrete & Repetitive LO050 5 days Engineering Change Management LO980 3 days Batch Management LO955 3 days KANBAN LO235 2 days Classification LO985 3 days Special Features of LIS in Production LO275 2 days Logistics Info Planning LO935 2 days CAP Calculation of Standard Values LO720 2 days Repetitive Manufacturing LO225 3 days Capacity Planning LO230 5 days Logistics Information System (LIS) Reporting LO930 2 days Basic Data Part 2 LO206 3 days Basic Data for Discrete Manufacturing LO205 3 days Production Orders LO215 5 days Production Planning LO210 5 days Variant Configuration Part 1 LO990 5 days Variant Configuration Part 2 LO991 3 days

4. © SAP AG 1999 z LO050 - Manufacturing Planning and Execution for Discrete and Repetitive z LO205 - Basic Data for Discrete Manufacturing Also recommended: z LO206 - Basic Data Part 2 Course Prerequisites

5. © SAP AG 1999 Target Group z Audience:   Project team members and othre individuals responsible for planning and scheduling. z Duration: 5 Days Notes for the user „ The training material is not suitable for a self-teach program. The course is only complete with the explanations from the instructor. There is space to note this additional information in the training material.

6. © SAP AG LO210 1-1 © SAP AG 1999 z Course Goals z Course Objectives z Course Content z Course Overview Diagram z Main Business Scenario Introduction Contents:

7. © SAP AG LO210 1-2 © SAP AG 1999 z explain the processes and implementation options of the planning strategies for non-configurable products, z describe the process of long-term planning, z use the most important transactions in Master Production Scheduling and Material Requirements Planning, analyze the Customizing parameters for Material Requirments Planning and evaluate the planning results, z describe the role of MRP areas in the planning process. This course will prepare you to: Course Goals

8. © SAP AG LO210 1-3 © SAP AG 1999 z set up and use planning strategies and Customizing for non-configurable products, z implement long-term planning and master production scheduling in production planning, z execute material requirements planning and evaluate the results, z configure the technical processes and related Customizing, z describe the planning process whereby MRP areas are used. At the conclusion of this course, you will be able to Course Objectives

9. © SAP AG LO210 1-4 © SAP AG 1999 Unit 6 Master Production Scheduling Unit 7 Long-Term Planning Unit 8 Technical Information on How the Planning Run Works Unit 9 MRP Areas Unit 1 Overview Unit 2 Introduction Unit 3 Demand Management Unit 4 MRP Run Unit 5 Processing MRP Results Preface Appendix Course Content

10. © SAP AG LO210 1-5 © SAP AG 1999 Course Overview Diagram 22 Overview 44 MRP Run Introduction11 33 Demand Management Processing MRP Results55 Discontinued Parts1010 99 MRP Areas 88 Technical Information on How the Planning Run Works 66 MPS 77 Long-Term Planning

11. © SAP AG LO210 1-6 © SAP AG 1999 z You are in a company, which manufactures pumps, as a member of a project team. This team is responsible for the implementation of production planning, ranging from demand management to material requirements planning. The pumps are not configurable. z You want to apply planning strategies for the procurement of non-configurable pumps in demand management. The demand programs are to be simulated for the medium and long term. Certain products are processed more precisely using master production scheduling, before material requirements planning is executed for all materials in the company. Main Business Scenario

12. © SAP AG LO210 2-1 © SAP AG 1999 Overview Contents: z Overview of Production Planning in the R/3 System z MRP procedure in the R/3 System

13. © SAP AG LO210 2-2 © SAP AG 1999 Overview: Unit Objectives z describe the steps involved in the production planning process, z name the different MRP procedures in the SAP System. At the conclusion of this unit, you will be able to:

14. © SAP AG LO210 2-3 © SAP AG 1999 Course Overview Diagram 2 11 Overview 44 MRP Run Introduction22 33 Demand Management Processing MRP Results55 Appendix1010 99 MRP Areas 88 Technical Information on How the Planning Run Works 66 Master Production Scheduling 77 Long-Term Planning

15. © SAP AG LO210 2-4 © SAP AG 1999 APO as a Planning Tool APOAPOR/3R/3 Global ATP Global ATP DeploymentDeployment SAP BW Historical data Key figures External data SAP BW Historical data Key figures External data Demand PlanningDemand Planning Sales Order Stock Mgmt Production and detailed scheduling Production and detailed scheduling Supply Network Planning Supply Network Planning Supply Chain Cockpit „ APO enables the global mapping, planning and monitoring of all processes in the logistics chain at a detailed level. „ Open standard interfaces allow a smooth integration of SAP systems (highly integrated solution for R/3), old systems and systems from other providers. „ APO has high efficiency levels with liveCache, an SAP tool for memory-resident data processing. „ APO is purely a planning tool: Inventory management, sales order creation, order execution and manufacturing execution take place outside of the APO system, for example in an R/3 system. „ You can use APO to create and change orders (planned, production and process orders) as results of a planning run. „ You can linke the APO system to R/3 using the APO-Core-Interface (CIF). Data thereby remains constant in both (APO and R/3). „ Planning with APO is covered in detail in the courses AP010 to AP230.

16. © SAP AG LO210 2-5 © SAP AG 1999 Production Planning and Control Sales Demand Management Long-Term Planning Master Production Scheduling Sales &Sales & Operations PlanningOperations Planning Production Planning MRP Period-Based Planning and Manufacturing Discrete Manufacturing Project-Based Manufacturing Process Manufacturing KANBANKANBAN Plnd Indep. Requirements Dates and quantities for assemblies Simulation

17. © SAP AG LO210 2-6 © SAP AG 1999 Classic Planning Levels OK? Feedback Product group Assembly 1 Assembly 2 Part 1 Part 2 Product 1 Product 2 SOP OK? OK? OK? Region 1 Region 2 MP CO/PA MRP Profitability AnalysisProfitability Analysis - Revenue plans- Revenue plans - Sales plans (quantities)- Sales plans (quantities) Sales & Operations PlanningSales & Operations Planning - Sales plan- Sales plan - Production plan- Production plan Production PlanningProduction Planning - Demand program- Demand program - Adjusted master plan- Adjusted master plan MRPMRP - Dependent requirements- Dependent requirements - Master plan- Master plan - Procurement plan- Procurement plan

18. © SAP AG LO210 2-7 © SAP AG 1999 Production Planning MPS MRPMRP ProductionProduction ControlControlDemandDemand ManagementManagement SettlementSettlement LongLong--TermTerm PlanningPlanning Capacity Planning Capacity Planning Inventory Mgmt Inventory Mgmt SalesSales && OperationsOperations PlanningPlanning Controlling

19. © SAP AG LO210 2-8 © SAP AG 1999 MRP Procedures based on consumption in the past MRP ProceduresMRP Procedures controlled by MRP type in Material master MRPConsumption- based Reorder point planning Forecast-based planning Time-phased planning „ Consumption-based planning is based on consumption values in the past and uses forecasts or statistical procedures to determine future requirements. Consumption-based planning is characterized by its simplicity and is mainly used for B and C parts with a low value. „ In contrast to consumption-based planning, Material requirements planning takes current and future sales as it’s reference point and is executed for the whole BOM structure. The planned and, depending on planning strategy, actual requirements quantities trigger the MRP calculation. It produces better planning results than does consumption-based planning. „ In this course, we will be dealing with material requirements planning.

20. © SAP AG LO210 2-9 © SAP AG 1999 Consumption-Based Planning using reorder point planning as an example Replenishment lead time Stock Lot size Reorder point Safety stock Reorder point Delivery date Time „ Manual reorder point planning is a typical process in consumption-based planning. It is characterized by its simplicity. „ You control the planning using a manually entered reorder point (for example, 50 pieces). During the planning run, the system checks only whether stock has fallen below this reorder point or not (that is, whether there are less than 50 pieces in stock). If that is the case, the system triggers procurement of the amount of the lot size (a fixed lot size of 500 pieces for example). „ If schedule lines are created directly by the planning run, for example, for materials procured externally, the administrative work for this sort of planning is minimal. „ Consumption-based planning is appropriate only for materials with demand that stays relatively consistent. Real-time inventory management is also necessary.

21. © SAP AG LO210 2-10 © SAP AG 1999 Overview: Unit Summary z Alongside Production Planning, SAP also offers APO as a planning tool for special tasks in the R/3 System. z The basic MRP procedure in the R/3 System is defined using the MRP type in the material master: MRP or consumption-based planning.

22. © SAP AG LO210 2-11 Exercises Unit: Overview Topic: Production Planning Procedure in the R/3 System At the end of these exercises, you will be able to: • execute the steps required for the production planning process in the R/3 System. Precision Pumps Inc uses the make-to-stock production strategy. Pumps are produced to stock and then sold. 1-1 In plant 1000, enter a demand program (planned independent requirements) for material T-F1## (replace ## with your group number). Select make-to-stock production (LSF requirements) for the first 8 weeks of your planning period. To do this, proceed as follows: 1-1-1 Maintain the material master: Make sure in the material master for pump T- F1## in the MRP 3 view that the strategy group PP has been entered for plant 1000. 1-1-2 In Demand Management, enter the following planned independent requirements (requirement type LSF) for material T-F1## in plant 1000. Set the planning period to week format by entering the indicator W in the planning period field in the initial screen for the transaction. Enter the following planned independent requirements for pump T-F1## in plant 1000: Current week + 5 Current week +6 Current week +7 ... Current week +12 25 25 25 ... 25 (total quantity: 200 pieces) Save your entries. 1-1-3 Starting from the MRP menu, display the stock/requirements list for material T-F1## in plant 1000. Note down the exact date of the second LSF requirement: ___________________

23. © SAP AG LO210 2-12 1-2 Starting from the MRP menu, carry out multi-level, single-item planning for pump T-F1##. In the initial screen of the planning run, enter the following creation indicators: Processing key NETCH Create pur.req. 2 Delivery schedules 3 Create MRP list 1 Planning mode 1 Scheduling 1 Also plan unchanged components Select Display results before they are saved Do not select Display mat. list Select Simulation mode Do not select 1-2-1 In this initial screen for single-item, multi-level MRP, save the settings you have made for the MRP run by selecting the menu path Settings -> Save. 1-2-2 Start the MRP run by choosing Enter and confirm the system warning by choosing Enter again. 1-3 Once the MRP run has been carried out successfully, the system displays the statistics. 1-3-1 Choose the pushbutton List of materials and select the row containing your pump T-F1## by selecting the button at the beginning of the row with a mouseclick. Goto the Display of the stock/requirements list for the material. You can now see the planned orders created for the requirements. 1-3-2 Display one of the planned orders by selecting it and choosing Display element. Select the Component overview pushbutton and compare the order start date of the end product T-F1## with the requirements date for the assemblies T-B1##, T-B2## and T-B3##. Explain the logic behind the date. ____________________________________________________ Exit the display of the planned order.

24. © SAP AG LO210 2-13 1-4 In the stock/requirements list, you convert the first two planned orders into production orders, and then release each production order. Starting from the MRP menu, display the stock/requirements list for material T-F1## in plant 1000. 1-4-1 Display the Additional data for element for the first planned order in the list. Choose the Convert planned order into production order function. Release the production order and save the order. 1-4-2 Repeat the operation for the second planned order. 1-4-3 Refresh the display by selecting Refresh. Make a note of the production order numbers. Production order number 1 __________________ Production order number 2 __________________ You may have to wait a few seconds for the asynchronous update to read the data from the queue and update it to the database. You can access the function several times again, until you see the production orders. 1-5 Now assume that you have produced the product, and can post the end product, the pump, to stock. (Completion confirmation is missed out for the purposes of this training example) 1-5-1 Execute the goods movement (more precisely: Goods receipt for order) from the Inventory Management menu using the following parameters: Movement type: 101 (Movement type → Order to warehouse) Order number: the first of the order numbers you noted down Plant: 1000 Storage location: 0002. Post the goods movement and repeat the operation for the second planned order number. 1-5-2 Check the stock situation in the stock/requirements list and make a note of the quantity of the oldest plnd ind. reqmt: _____________________ the date of the oldest plnd ind. reqmt: _____________________ the quantity available today: _____________________

25. © SAP AG LO210 2-14 1-6 A customer arrives and spontaneously buys 8 pumps (over-the-counter sales). 1-6-1 From the Inventory Management menu, you now post the stock withdrawal to sales (i.e., a goods issue). When posting the goods movement, use the following parameters: Movement type: 251 (Movement type → Consumption → To sales → From warehouse) Plant: 1000 Storage location: 0002 Cost center: 3110 (sales pumps) Enter the item for the material T-F1## and a quantity of 8 pieces. Post the goods movement. 1-6-2 After entering the data, call up the stock/requirements list again. How has the oldest planned independent requirement (noted above) been changed (quantity of oldest planned independent requirement)? __________________________ What quantity is now available from stock? __________________________ Compare the two quantities and explain the new stock/requirements situation. ____________________________________________________

26. © SAP AG LO210 2-15 Solutions Unit: Overview Topic: Production Planning Procedure in the R/3 System 1-1 1-1-1 Menu path: Logistics → Production → Master Data → Material Master → Material → Change → Immediately 1-1-2 Menu path: Logistics o Production o Production Planning o Demand Management o Planned Independent Requirements o Create 1-1-3 Menu path: Logistics o Production o MRP o Evaluations o Stock/requirements list Date of second LSF requirement: Varies 1-2 Menu path: Logistics o Production o MRP o Planning o Single-item, Multi- level 1-3 1-3-1 1-3-2 Explain the logic behind the date. The requirements dates for the assemblies coincide with the order start date of the planned order for the finished product. The assemblies are therefore available at the start of production for the finished product. 1-4 Menu path: Logistics o Production o MRP o Evaluations o Stock/requirements list 1-4-1 1-4-2 1-4-3 Production order number 1: Varies Production order number 2: Varies

27. © SAP AG LO210 2-16 1-5 1-5-1 Menu path: Logistics o Materials Management o Inventory Management o Goods Movement o Goods Receipt o For Order 1-5-2 the quantity of the oldest plnd ind. reqmt: 25 the date of the oldest plnd ind. reqmt: Varies the quantity available today: 50 1-6 1-6-1 Menu path: Logistics o Materials Management o Inventory Management o Goods Movement o Goods Issue 1-6-2 Oldest planned independent requirement (noted above): 17 Available quantity from stock: 42 Explanation: 8 pumps have been sold and the corresponding stock withdrawal has been posted. The available quantity thereby falls from 50 pieces to 42 pieces. The sales reduce simultaneously the (LSF) planned independent requirements that you entered at the start. This follows the FIFO rule (first in – first out), whereby the oldest requirement is reduced first. It has therefore sunk from 25 pieces to 17 pieces.

28. © SAP AG LO210 3-1 © SAP AG 1999 Demand Management Contents: z Managing Planned Independent Requirements z Planning strategies z Customizing settings

29. © SAP AG LO210 3-2 © SAP AG 1999 Demand Management: Unit Objectives z Create planned independent requirements in Demand Management z Describe the functions and differences among the planning strategies z Use the consumption and reduction procedures for planned independent requirements. z Apply the most important Customizing settings for Demand Management. z Differentiate between the two availability checking methods. At the conclusion of this unit, you will be able to:

30. © SAP AG LO210 3-3 © SAP AG 1999 Course Overview Diagram 3 11 Introduction 55 Processing MRP Results MRP Run44 33 Demand Management Overview22 Discontinued Parts1010 99 MRP Areas 88 Technical Information on How the Planning Run Works 66 MPS 77 Long-Term Planning

31. © SAP AG LO210 3-4 © SAP AG 1999 Categories of Planning Strategies z Make-to-stock production z Order production (Make-to-order production) z Order-specific final assembly (Assemblies to stock using make-to-stock, finished products to individual customer stock using make-to-order production)

32. © SAP AG LO210 3-5 © SAP AG 1999 „„ Make-to-stock production (anonymous)Make-to-stock production (anonymous) 1010 „„ Make-to-stock production/grossMake-to-stock production/gross reqmtsreqmts planningplanning 1111 „„ Production by lotsProduction by lots 3030 „„ Planning with final assemblyPlanning with final assembly 4040 „„ Planning at assembly levelPlanning at assembly level 7070 „„ Planning at phantom assembly levelPlanning at phantom assembly level 5959 • Target: Smooth production load even if demand varies. • Planning carried out using planned independent requirements Strategies of Make-to-Stock Production „ The make-to-stock production strategies plan production or procurement using planned independent requirements, which can be created from sales or forecast figures. Sales orders are covered by stock from the warehouse. „ Make-to-stock production strategies are used in industries where demand and sales fluctuate but where production may be kept at full capacity. Fluctuations in demand and sales are smoothed by warehouse stock.

33. © SAP AG LO210 3-6 © SAP AG 1999 MRP Warehouse stock Finished product Sales orders from whse Demand program R e d u c t i o n Make-to-Stock Production/Net Reqmts Plng (10) Customer requirements covered by warehouse stock „ The demand program is defined without reference to sales orders. „ Sales orders are not relevant to MRP, but can be displayed for information purposes. You make this setting in the "No MRP" field in Customizing for the appropriate requirements class (workstep, "Defining Requirements Classes" in Customizing for SD). „ Sales orders are covered by warehouse stock. In Sales and Distribution, you can carry out the availability check according to ATP logic. Material withdrawals for a sales order reduce this sales order’s quantity. „ The consumption of the demand program (that is of the planned independent requirements) is carried out at goods issue (the indicator "PIR reduction" in Customizing of the requirements class 30 must be set if you want to reduce the demand program when delivering to a sales order). The oldest planned independent requirement is reduced first according to the FIFO (first-in-first-out) principle using the requirement date. Future planned independent requirements are also reduced by goods issues, if allowed by the consumption mode and the forward consumption period.

34. © SAP AG LO210 3-7 © SAP AG 1999 Make-to-Stock Production Gross reqmts planningGross reqmts planningGross reqmts planningNet reqmts planningNet reqmts planningNet reqmts planning Strategy 10 Strategy 11 = WSWSWS PIRPIRPIR POPO _ RRR _ = PIRPIRPIR POPO _ RRR PO Planned order PIR Planned independent requirements R Receipt WS Warehouse stock PO Planned order PIR Planned independent requirements R Receipt WS Warehouse stock In gross requirements planning, NO warehouse stock is taken into account. InIn gross requirements planninggross requirements planning,, NO warehouseNO warehouse stockstock isis takentaken into accountinto account.. In net requirements planning, the system takes warehouse stock into account. InIn net requirements planningnet requirements planning,, the systemthe system takestakes warehousewarehouse stock into accountstock into account.. „ In addition to net requirements planning, gross requirements planning is another strategy of make-to- stock production. „ Planned orders, production orders, purchase orders and other elements are taken into account as receipts when determining requirements. „ In the case of gross requirements planning, no warehouse stock is taken into account. Only receipt elements are included in the net requirements calculation. „ In net requirements planning, the available warehouse stock for planning is taken into account.

35. © SAP AG LO210 3-8 © SAP AG 1999 Make-to-Stock Production/Gross Reqmts Plng (11) Demand program MRP Warehouse stock Finished product Sales orders from whse R e d u c t i o n Customer requirements covered by warehouse stock „ The demand program is defined with no reference to sales orders or existing warehouse stock. This is why one talks of "forced production" with regard to this production strategy. „ Sales orders are not relevant to MRP, but can be displayed for information purposes. You have to define this in the "no MRP" field for the appropriate requirements class in Customizing. „ Sales orders are covered by warehouse stock. In Sales and Distribution, you can carry out the availability check according to ATP logic. „ The demand program is reduced by the receipt of goods in the warehouse. „ You must have entered the gross requirements planning strategy in the strategy group of the material master (view: MRP 3) and have set the mixed MRP indicator to "gross requirements planning" in the material master (view: MRP 3). „ A separate segment is created for gross requirements planning in the current stock/requirements list and the MRP list.

36. © SAP AG LO210 3-9 © SAP AG 1999 Sales order Warehouse reqmt MRP Warehouse stock Finished product Delivery Sales order Sale from stock R e d u c t i o n R e d u c t i o n Production by Lots (30) 50 pc Total reqmts 80 pc Procurement by lot size (From stock) 30 pc Example material: Pump „ In production by lots (strategy 30), the requirements for the finished product are transferred to MRP when a sales order is created. You can also plan additional warehouse requirements in Demand Management. „ Customer requirements do not consume planned independent requirements. „ Requirements are grouped according to the lot-sizing procedure defined in the material master record. „ Sales orders are covered by stock from the warehouse. The customer requirement is reduced by the goods issue. In Sales and Distribution, you can carry out the availability check according to ATP logic. „ The stock orders created additionally in demand management are reduced by the goods issue to the stock order (the reduction is carried out according to the FIFO principle as in strategy 10). „ You can use this strategy when you need to reduce orders for major customers and factory sales from the warehouse, for example.

37. © SAP AG LO210 3-10 © SAP AG 1999 CR Customer reqmt IR Plnd ind reqmt PO Planned order POPOPO POPOPO POPOPO Time IRIR CRCR IRIR CRCR CRCR IRIR Quantity Time 01.03. 07.03. 14.03. 21.03. 01.03. 07.03. 14.03. 21.03. Production by Lots for Sales and Stock Orders Example used here: Weekly lot sizes „ In production by lots, the system groups the procurement quantities for customer requirements and planned independent requirements into lots. To do this the system uses the lot-sizing procedure defined in the material master record.

38. © SAP AG LO210 3-11 © SAP AG 1999 Customer reqmtCustomer reqmtIndep. reqmtsIndep. reqmts Warehouse stock Finished product Planning with Final Assembly (40) ConsumptionConsumption Target: Fast reaction to customers’ demands keeping production as smooth as possible. ProductionProduction Sales orders affect requirements and consume planned independent requirements „ In planning with final assembly (strategy 40), the main focus is on flexibility in reacting to customers’demands. „ Production, including final assembly, is triggered by the planned independent requirements before the sales order is received. „ You plan the planned independent requirements for the finished product in Demand Management. Incoming sales orders consume these planned independent requirements. „ Planned independent requirements left unconsumed increase the warehouse stock - as long as they are not adjusted to customer requirements (“Adjust Requirements“ is a function to be run periodically to ensure that old, unconsumed planned independent requirements no longer have an effect on planning). „ If customer requirements exceeds planned independent requirements, the system automatically creates a planned order for the unplanned quantity in the next MRP run. „ You can check availability using the ATP logic. „ The consumption of planned independent requirements by customer requirements depends on the settings defined for the consumption mode and the consumption periods.

39. © SAP AG LO210 3-12 © SAP AG 1999 Plnd indep. reqmts Customer req. Time Backward consumption only Bwd per.Backward consumption per. Forward consumption only Time Forward consumption period 1 2 Backward/forward consumption Time Fwd per.Bwd per. Fwd per. Consumption Mode 60 4020 20 Example: Within the given period of time, 60 pieces are produced for the sales order and 20 pieces are produced (anonymously) to stock. Mode 1 Mode 3 Mode 2/4 „ You can use the consumption mode to define in which direction incoming sales orders are to consume planned independent requirements on the time axis. „ In backward consumption (consumption mode 1), the sales order consumes planned independent requirements that lie before the customer requirement. „ In forward consumption (consumption mode 3), the sales order consumes planned independent requirements that lie after the customer requirement. „ You can combine backward and forward consumption provided that you take the consumption periods into account (consumption mode 2 or 4). „ You can define the consumption mode and the consumption periods either in the material master or for each plant and MRP group. If no values have been entered, the system uses the default setting with backward consumption for 999 days (note: if you do not maintain mode 1 and the backward consumption interval, this means that only the requirements on the current day can be consumed).

40. © SAP AG LO210 3-13 © SAP AG 1999 Sales order Indep. reqmts Indep. reqmts MTS/ MTO production Finished product MTS/ MTO production Finished product Whse stock Assembly 02 Whse stock Assembly 03 Final assembly Final assembly Planning at Assembly Level (70) Dep.req/Res.Dep.req/Res. Consumption 1. Planning at assembly level using planned indep. reqmts1. Planning at assembly level using planned indep. reqmts 2. Consumption by the dependent reqmts of the finished product2. Consumption by the dependent reqmts of the finished product Manufactu ring Manufactu ring „ It makes sense to plan at assembly level (strategy 70) when processing variants if it is easier to specify a requirements forecast for certain assemblies than it is for the variant diversity of the finished product. „ In this planning strategy, the planned independent requirements for an assembly are planned separately. They are created at assembly level and they trigger the production of the assembly. „ When a sales order is received for the finished product, the BOM is exploded for the finished product. Dependent requirements or reservations are also created for the assembly as a result of planned orders or production orders for the finished product. These consume the planned independent requirements of the assembly. „ If, due to sales orders, planned orders or production orders at finished product level, the dependent requirements or reservations exceed the assembly’s planned independent requirements, a planned order is created for the assembly during the next planning run. „ In Sales and Distribution, the system does not perform a check of the assembly planning quantities. „ In the strategy group of the material master record, you must enter strategy 70 and the mixed MRP indicator must be set for assembly planning. „ The consumption indicator in the Demand Management item screen must allow consumption with reservations and dependent requirements.

41. © SAP AG LO210 3-14 © SAP AG 1999 BOM explosion Indep. reqmts Dep. reqmts Sales, planned, production orders AssemblyAssembly Indep. reqmts 11 22 33 Finished productFinished product AssemblyAssembly Consumption in Assembly Planning „ In the first step, you create the requirement quantities expected in the future for the assembly. You do this in Demand Management. „ You create either sales orders, planned orders or production orders. „ The resulting dependent requirements or reservations (for the assembly) consume the planned independent requirements of the assembly.

42. © SAP AG LO210 3-15 © SAP AG 1999 Time Consumption period Backward Forward Dependent requirement or reservationAssembly’s planned indep. reqmts Assembly’s planned indep. reqmts Subassembly Planning: Consumption Periods „ The consumption logic is defined by the consumption mode and the consumption periods backward and forward as in strategy 40. These are defined in the material master record of the assembly or per plant and MRP group. „ The consumption periods are calculated starting from the dependent requirements or the reservations.

43. © SAP AG LO210 3-16 © SAP AG 1999 PhantomPhantom Phantom Assemblies Definition: By the special procurement key in the material master record (can be overruled in the BOM) Dep.reqmts Dep.reqmts Dep.reqmts Dep.reqmts Planning „ A phantom assembly can represent an assembly which is created in the production process, but is not placed in stock; rather it is used immediately. Phantom assemblies can also represent a logical grouping. For example, a car radio assembly consists of the radio, speakers and an aerial. „ You can indicate that an assembly is a phantom assembly by entering a special procurement type in the material master record (if necessary per MRP area). „ In the planning run, the dependent requirements of the higher-level assembly are directly passed down to the components of the phantom assembly. „ In exceptional cases, phantom assemblies can be placed in stock and withdrawn at a later date.

44. © SAP AG LO210 3-17 © SAP AG 1999 Reservation DependentReservation Dependent reqmtsreqmts Reduction of Reservation Finished product Component 01 Sales orderSales order Plnd indPlnd ind.. reqmtsreqmts forfor phantom assemblyphantom assembly Phantom assembly 1.1. 2.2. 1.1. Procurement Production orderProduction order BackflushBackflush 4.4. 3.3. 5.5. 3.3. Finalassembly 3.3. Consumption of indep. reqmts 5.5. 5.5. Reduction of plnd ind.reqmts Planning at Phantom Assembly Level (59) Component 02 Procedure as strategy 70 Complication: missing warehouse level „ In the strategy group of the material master, you must define the phantom assembly planning strategy (strategy 59) and you must set the mixed MRP indicator for assembly planning and the special procurement key for the phantom assembly. „ In step one, the planned quantities for the phantom assembly are set (1). This planned independent requirement leads to the creation of a dependent requirement for the components of the phantom assembly in the planning run and it triggers procurement (2). „ The dependent requirement (not relevant to MRP) of the sales order or of the planned order for the finished product or the reservation (not relevant to MRP) of the production order for the finished product consumes the planned independent requirements of the phantom assembly. Reservations for components that are relevant to MRP are reduced (3). „ Once final assembly has been carried out (4), the phantom assembly is confirmed and, if necessary, the components of the assembly backflushed. The planned independent requirements of the phantom assembly and the reservations are reduced (5). „ Backflushing is important so that the planned independent requirements and the reservations can be reduced consistently. Make sure that all components of the phantom assembly are backflushed simultaneously.

45. © SAP AG LO210 3-18 © SAP AG 1999 • Make-to-order production 20 • Planning without final assembly 50 • Planning at assembly level without final 74 • Planning with planning material 60 Strategies for Order-Specific Final Assembly • Assembly processing repetitive manufacturing 81 • Assembly processing with production order 82 • Assembly processing with network w/o project 83 Strategies for Make-to-Order Production Sales Order-Related Planning Strategies „ When working with the strategies for make-to-order production, the sales order is the only pegged requirement. „ Alongside classic make-to-order production, you also have the option of planning without final assembly and assembly processing with production orders.

46. © SAP AG LO210 3-19 © SAP AG 1999 Make-to-Order Production (20) Sales order B Production Customer stock Finished product D E L I V E R Y e Sales order A Production Customer stock Finished product D E L I V E R Y e Material Requirements Planning Material P-100Material P-100 „ In make-to-order production (strategy 20), every sales order is planned individually and managed in its own segment in the MRP list or the current stock/requirements list. „ The system does not perform a net requirements calculation between individual sales orders or with the anonymous warehouse stock. „ In make-to-order production, the lot-for-lot order quantity is used as the default setting for the lot- sizing procedure, regardless of the entry you have made in the material master record. You define the lot-sizing procedure for make-to-order production in Customizing for MRP in the workstep "Checking the lot-sizing procedure" in the field "Lot-size calculation for MTO production". Depending on the setting of the lot-size indicator in the material master record, you can define a different lot size for make-to-order production from the one used in make-to-stock production. „ Using the "individual/collective" indicator, you can allow make-to-order production at any level of the BOM structure. „ You cannot switch the produced quantities from one sales order to another - the produced quantities are managed directly for each individual sales order (in the individual customer stock). „ The individual customer stock and the requirement is reduced by a goods issue to the sales order. As soon as the sales order is completed and the individual customer stock depleted, the individual customer segment disappears from the current stock/requirements list or the MRP list. „ The system manages the production and procurement costs specifically for each sales order in a settlement order or project.

47. © SAP AG LO210 3-20 © SAP AG 1999 Prod.order 10 pc SO stock 20 pc Sales order A SO stock 10 pc SO quantity 20 pc Prod.order 15 pc SO stock 15 pc Sales order B SO stock 0 pc SO quantity 15 pc Plnd order 15 pcPlnd order 10 pc MRP Material P-100 Make-to-Order Production: Example „ The net requirements calculation is carried out individually for every sales order. Stock cannot be swapped back and forth between sales orders. „ The procurement elements, that is the planned orders are created with reference to the sales order and are managed in the individual customer segment. This direct reference to the sales order also remains in the production order.

48. © SAP AG LO210 3-21 © SAP AG 1999 Individual / Collective Indicator MRP List: Pump Date Today Today Date Date Today Date Date MRP element Stock Order A Planned order 123 Order A Order B Planned order 124 Order B Qties 10 10- 12 12- Avail. 0 0 10 0 0 12 0 MRP List: Spiral Casing Date Today Date Date Date MRP element Stock Planned order 127 Dep. reqmts pump Dep. reqmts pump Quantities 17 10- 12- Avail. 5 22 12 0 Individual/ collective ind. = 1 Spiral casing Pump Shaft Sales order A Qty 10 Sales order B Qty 12 Individual/ collective ind. = 2 MRP List: Shaft Date Today Today Date Date Today Date Date MRP element Stock Order A Planned order 125 Dep. reqmts pump Order B Planned order 126 Dep.reqmts pump Quantities 10 10- 12 12- Avail. 0 0 10 0 0 12 0 To be set in the material master record (can be overruled in the BOM) „ The individual/collective indicator in the material master record determines whether a component is procured for a special customer requirement in the individual segment. „ The indicator "1" for individual requirements means that the material is being specially manufactured or procured for a sales order. A special individual segment is created for each requirement. An individual requirement is only created if the higher-level material does not create a collective requirement. „ The indicator "2" for collective requirements means that the material is produced or procured for various requirements. You can find these requirements in the net requirements segment. „ The indicator "blank" means that the component is to be planned in the same way as the higher-level assembly. „ In the above example, two individual segments are created for the shaft for sales orders A and B. „ If you want to control the material item individually for the respective BOM, use the "explosion control" field in the component’s item data (general data view). The setting in the BOM overrules the setting in the material master record.

49. © SAP AG LO210 3-22 © SAP AG 1999 P-100 100-100 I Strategy 20 I/C = 1 I/C = 2 100-210 CI/C = 1100-120 II/C = 1100-110 II/C = ’_’ 100-200 Individual / Collective Indicator: Example Example material: Pump P-100 Indiv./coll. ind. in the material master record Individual reqmts Collective reqmts I/C I I C C „ All materials that, in the BOM, are under one material in collective requirements are planned as collective requirements irrespective of the setting in the material master record.

50. © SAP AG LO210 3-23 © SAP AG 1999 Planning w/o Final Assembly (50): Plnd Ind.Reqmts Procurement Plnd indep. reqmts MRP 1.1. 2.2. 3.3. Whse stock Spiral casing Whse stock Spiral casing Whse stock Shaft Whse stock Shaft PumpPump VP Plnd order „ As make-to-order production, planning without final assembly (strategy 50) enables you to manufacture products specifically for a customer. However, with this planning strategy, certain assemblies should be produced or procured before the sales order for the finished product is received. The material is produced up to the production level below final assembly. That is, the assemblies and components are stocked in the warehouse until the sales order is received. Final assembly is only triggered upon receipt of the sales order. It makes sense to use this strategy if a large part of the value added process occurs at final assembly. „ Planning which is independent of the sales order is organized using planned independent requirements. These planned independent requirements are created for the finished product. In the MRP run, the system first creates planned orders for the finished product to cover these requirements. These planned orders cannot be converted into production orders (order type VP). When sales orders are entered and MRP is next run, the system creates planned orders to offset the sales orders; these planned orders can be converted to production orders or purchase requisitions. Also in the MRP run, the planned orders of type VP are adjusted to offset the remaining, unconsumed planned independent requirments. „ Using the strategy, "planning without final assembly", you can reduce delivery times since production and procurement should have already been triggered for the lower production levels before the sales order is received.

51. © SAP AG LO210 3-24 © SAP AG 1999 Planning w/o Final Assembly: Sales Order Finalassembly Whse stock Spiral casing Whse stock Spiral casing Whse stock Shaft Whse stock Shaft PumpPump Plnd indep. reqmts 5.5. MRP 6.6. 4.4. Sales order ConsumptionConsumption KD Plnd order „ Final assembly is only triggered upon receipt of the sales order. The sales order appears in an individual customer planning segment in the current stock/requirements list where it is planned separately. In the next MRP run, the system creates a planned order for the newly created sales order. This planned order can be converted into a production order. This then allows final assembly. In the planning segment, the planned order quantity of the "VP" planned order is reduced corresponding to the new requirements situation. „ In this strategy, the sales order is managed in the individual customer planning segment. If this is not desired, you can also manage the sales order in the net requirements segment (strategy 52), although should you choose this procedure, you have to work with the lot-sizing procedure "lot-for-lot order quantity". You also need to make sure that neither rounding values/rounding profiles nor minimum or maximum lot sizes are maintained. Otherwise, the assignment logic is not compatible with an availability check which could lead to excess planning or incorrect results in the availability check. „ You can only carry out the availability check for planned independent requirements. That is, the check of planned independent requirements at finished product level.

52. © SAP AG LO210 3-25 © SAP AG 1999 Planned Orders with Planning Type "VP" Subcontracting Direct production External procurement Stock transfer I cannot be changed manually ! I cannot be converted! Capacity planning VP Plnd order „ Planned orders with order type VP can be created for external procurement, subcontracting, stock transfer or direct production. „ These orders cannot be changed manually and cannot be converted into production orders or purchase orders. „ Capacity planning is possible for planned orders with order type VP.

53. © SAP AG LO210 3-26 © SAP AG 1999 Quantities for Final Assembly PlannedPlanned indind.. reqmtsreqmts Quantity Time Sales ordersSales orders Triggers final assembly with sales order quantity Whse stock Shaft Pump Whse stock Shaft Pump Whse stock Spiral casing Quantity Triggers production of assemblies Time Created for pCreated for pumpump Created for pCreated for pumpump Whse stock Spiral casing „ Example: If a planned independent requirement of 100 pieces exists and you receive a sales order for 40 pieces which consumes the planned independent requirements then the sales order for 40 pieces remains in the individual customer planning segment and a planned independent requirement for 60 pieces remains in the net requirements segment. As soon as the product is planned again in the next MRP run, the system creates a planned order for 40 pieces in the individual customer planning segment which you can convert into a production order. At the same time, the system reduces the existing planned order of type VP from 100 pieces to 60 pieces.

54. © SAP AG LO210 3-27 © SAP AG 1999 Planning w/o Final Assembly: Master Data Whse stock Spiral casing Whse stock Spiral casing Whse stock Shaft Whse stock Shaft PumpPump Strategy group 50Strategy group 50 Indiv./collective = 2Indiv./collective = 2 „ If you want to use the "Planning without final assembly" strategy for the finished product, you must make the following settings in the material master record ("MRP" view): „ Strategy group 50 ("Planning without final assembly") for the finished product. „ Indiv. / Collective indicator = 2 (collective requirements only) for the assembly, which is to be procured and stored (supplied for storage) before the sales order is received.

55. © SAP AG LO210 3-28 © SAP AG 1999 Stocking Level High value added Stocking level Low value added PumpPump Whse stock Spiral casing Whse stock Spiral casing Whse stock Shaft Whse stock Shaft Plnd indep. reqmts Sales order „ If a large part of the value added process occurs at final assembly it makes sense to use strategy 50 ("Planning without final assembly"). Here, final assembly is not triggered until a sales order has been received.

56. © SAP AG LO210 3-29 © SAP AG 1999 Flexible Determination of Stocking Level Whse stock Spiral casing Whse stock Spiral casing Whse stock Shaft Whse stock Shaft PumpPump Stocking level Stocking level Indiv./collective = 1 or "blank" Indiv./collective = 1 or "blank" Strategy group 50Strategy group 50 Indiv./collective = 2Indiv./collective = 2 VP Plndorder VP Plndorder „ The stocking level is the level in the product structure up to which the material is produced to stock. You can shift the stocking level for certain materials: If, for example, you should set the indiv. / collective indicator to "1" (individual requirements only) or enter "blank" (individual and collective requirements) for the material "shaft" in the material master record (MRP view), then this material will not be produced until a sales order exists for it or the pump; it will not be produced to stock in advance. Only the components for the material "spiral casing" are procured and placed in stock before the sales order is received. For this example, therefore, you must set the indiv. / collective indicator to "2" (collective requirements only) for both the assembly "spiral casing" and for the components of the shaft. However, you only have to enter the strategy group for the pump. „ If you do not wish to create VP planned orders in all BOMs of a particular material, you can assign the "No VP planned orders" explosion control indicator in the "Basic data" for the BOM item. You define this indicator in the workstep "Defining Explosion Control" in Customizing for BOMs.

57. © SAP AG LO210 3-30 © SAP AG 1999 Procurement Cooling system Cooling system ProcessorProcessor Processor cooling unit Processor cooling unit FanFan Plnd indep. reqmts MRP 1.1. 2.2. 3.3. Material: ??Material: ?? MotherboardMotherboard Planning at Assembly Level w/o Final Assembly (1) Plnd indep. reqmts „ The strategy "Assembly planning without final assembly" (strategy 74) is a mixture of the strategies "assembly planning" (strategy 70) and "planning without final assembly" (strategy 50 or 52). As in strategy 70, in strategy 74 the planned independent requirements for an assembly are regarded separately and independent of any lot size. You do not have to know the finished production for which the assembly is required. „ The planned independent requirements are created at assembly level. As opposed to strategy 70 and as in strategies 50 and 52, the creation of the planned independent requirements does not trigger the production of the assemblies but the procurement of the components. The components are placed into stock until the planned order or the production order for the finished product is received. The production of the assembly is not triggered until the planned order or the production order for the finished product has been received. „ The planning run is carried out for the assembly and initially creates planned orders for the assembly’s planned independent requirements which cannot be converted into a production order nor can they be converted in repetitive manufacturing (order type VP). The planned independent requirements and the planned orders for the assembly are in the planning segment. Conversion and procurement (assembly) are not possible until a planned order or a production order for the finished product is created. At component levels below the assembly, however, the system creates planned orders in the planning run if a material shortage exists. These planned orders can be converted into a production orders or a purchase requisition. „ At this stage of planning, the stock at assembly level is not taken into account.

58. © SAP AG LO210 3-31 © SAP AG 1999 Cooling system Cooling system ProcessorProcessor Processor cooling unit Processor cooling unit FanFan Plnd indep. reqmts PCPC Finalassembly 5.5. MRP 6.6. 4.4. Dependent reqmts MotherboardMotherboard Planned order Production order Reservation Planning at Assembly Level w/o Final Assembly (2) Planned / production order „ Production of the assembly is not triggered until receipt of the planned order or the production order for the finished product. The dependent requirements and reservations created as a result of the planned order or the production order consume the planned independent requirements of the assembly (as in strategy 70). „ Depending on the strategy of the finished product and the individual/collective indicator of the assembly in the net segment, the dependent requirements and reservations of the assembly and the accompanying planned orders of the assembly appear in an individual customer segment or in the individual customer planning segment. „ In the planning run, dependent requirements and reservations in the net requirements segment or an individual customer segment result in planned orders that can be converted or that can be dispatched in repetitive manufacturing. This then allows the production of the assembly. At this stage of planning, stock at assembly level is regarded as stock in the net segment or as individual customer stock. In the planning segment, the planned order quantity of the "VP" planned order is reduced corresponding to the new requirements situation.

59. © SAP AG LO210 3-32 © SAP AG 1999 BOM explosion Plnd ind.reqs Reservation/dependent reqmts Planned/production orders AssemblyAssembly Plnd indep. reqmts 11 22 33 Finished productFinished product AssemblyAssembly Planning at Assembly Level w/o Final Assembly (3) Consumption (carried out as in strategy 70) „ In the first step, you create the requirement quantities expected in the future for the assembly. You do this in Demand Management. „ Sales orders or planned orders or production orders are created for the finished product. „ The resulting dependent requirements or reservations (for the assembly) consume the planned independent requirements of the assembly. „ The consumption mode and the consumption periods are calculated according to the reservation or the dependent requirements.

60. © SAP AG LO210 3-33 © SAP AG 1999 Cooling system Cooling system ProcessorProcessor Processor cooling unit Processor cooling unit FanFan Stocking level Indiv./collective = 1 or "blank" Indiv./collective = 1 or "blank" Material: ??Material: ?? MotherboardMotherboard Indiv./collective = 2Indiv./collective = 2 Strategy 74Strategy 74 Mixed MRP = 3Mixed MRP = 3 Planning at Assembly Level w/o Final Assembly (4) Master Data „ If you want to use the "Planning without final assembly" strategy for the assembly, you must make the following settings in the material master record ("MRP" view): • Strategy group 74 (planning without final assembly at assembly level) for the assembly • Mixed MRP indicator = 3 (assembly planning without final assembly) • Consumption parameters (consumption mode, backward consumption period, forward consumption period) • Indiv. / Collective indicator = 2 (collective requirements only) for the components to be procured and stored (supplied for storage) before receipt of the planned or production order. • Indiv. / Collective indicator = 1 (collective requirements only) or blank (individual and collective requirements) for the components not to be procured until receipt of the planned order or the production order for the finished product.

61. © SAP AG LO210 3-34 © SAP AG 1999 Whse stock Assembly 01 Sales order Plnd ind.reqsPlnd ind.reqs Non-variable part Assembly 03 Final assembly Customer stock Finished product Planning material Planning with the Planning Material (60) Non-variable part Assembly 02 Whse stock Assembly 01 Variant part Assembly 01 Note: Additional master data maintenance 1. You must create the planning material and assign it to its finished products 2. You must create BOM for planning material with variant parts (variant parts must also be contained in the BOM of the finished product) I am not produced! ProductionProduction „ The planning strategy "Planning with planning material" is particularly useful if you have several finished products with the same main assemblies. „ Here, you define a planning material which contains the common assembly and its BOMs. „ The planning run is carried out for the planning material which triggers the production and procurement of the planning material’s components. „ The sales order for a finished product which refers to the planning material reduces the planned independent requirements of the planning material and simultaneously triggers final assembly. „ When processing the sales order, you can check whether the planned independent requirements quantities cover the demand (that is, the availability check as a check against the planned independent requirements). „ In the material master record of the planning material, you must enter strategy 60, the consumption mode and the consumption periods. In the material master records which refer to the planning material, you must enter the planning material as a reference and strategy 60. The consumption periods are calculated starting from the planned independent requirements of the planning material.

62. © SAP AG LO210 3-35 © SAP AG 1999 Time Consumption period Backward Forward Independent Reqmts Qty of the Planning Material Sales Order Sales Order Materials not planned Planning Material: Consumption Periods „ The consumption periods are calculated starting from the planned independent requirements of the planning material. „ Consumption is carried out on receipt of the sales orders for the finished product which refer to the planning material. The link between the finished product and the planning material is created by assignment in the material master record. „ To ensure that quantity reductions are consistent, you must make sure that all assemblies contained in the BOM of the planning material are really contained in all the finished products which refer to this material. You must be particularly careful if the BOM is changed.

63. © SAP AG LO210 3-36 © SAP AG 1999 Finished product 1 Finished product 2 Planning material 100-100 100-200 1 1 1 1) Planned indep. reqmts 50 pc for planning and MRP 2) VP planned order 50 pc for planning 3) Procurement of the components from planning material: a) Planned orders for 100-100 (50 pc) and 100-200 (50 pc) b) Conversion of the planned orders to production orders for 100-100 and 100-200 c) Goods receipt of production order to warehouse for 100-100 and 100-200 each for 50 pc Optional: Planning Material Example (1) „ On this and on the following slides is example data to demonstrate how the strategy "planning with planning material (60)" works. „ The materials Finished product 1 and finished product 2 are finished products which refer to the planning material Planning. In all material master records, you must enter the strategy group 60 and in the material master records for Finished product 1 and Finished product 2 , you must enter the planning material Planning. „ The corresponding BOMs must also exist. The BOM for Planning contains two assemblies 100-100 and 100-200 and these two assemblies must also be included in the BOMs for Finished product 1 and Finished product 2. „ With these prerequisites, and using the steps described in the following slides, it is possible to describe a typical procedure in planning using strategy 60.

64. © SAP AG LO210 3-37 © SAP AG 1999 4) Warehouse stock 100-100 and 100-200 50 pc each 5) Sales orders: Dep. reqmts Sales orders consume planning material quantities: 6) MRP run Planning VP planned order reduced 7) MRP run Finished product 1, Finished product 2: The dependent requirements for the sales order are covered by stock. 5 pc 100-100 20 pc 100-100 5 pc 100-200 20 pc 100-200 20 pc Finished product 15 pc Finished product 2 Optional: Planning Material Example (2)

65. © SAP AG LO210 3-38 © SAP AG 1999 Assembly Order Confirmed quantity Confirmed date Configuration Assembly types Sales price Production orderPlanned order Project CustomerCustomer Sales order Quantity Material Desired date Strategy 81 Strategy 82 Strategy 83 Creates procurement elements Availability check at assembly level „ Assembly processing is a form of sales order processing. The procurement elements are created when you create the sales order items. „ In general, the components of the finished product have already been manufactured. „ Once you have created the sales order, the system checks the availability of the components (for the production order). It also determines a possible delivery date and costs the order. „ With strategy 82, creating the sales order triggers the creation of a production order. It is not necessary to carry out a separate MRP run. With strategy 81, when you create a sales orders, the system creates a planned order for repetitive manufacturing and with strategy 83, it creates a network for engineer-to-order production. „ Order processing is carried out using the tools available in production control, delivery is made in Sales and Distribution. „ The total confirmation date depends on the date of the components which are last to be available. „ The confirmation quantity depends on the available quantity of the components with the lowest confirmed quantity on the requirements date. „ Assembly processing can either be carried out statistically (an assembly order per sales order item) or dynamically (several assembly orders per sales order item). Dynamic processing enables you to execute partial deliveries. In this case, however, the direct reference to the sales order is lost.

66. © SAP AG LO210 3-39 © SAP AG 1999 Changes to Assembly Processing z Changes to the sales order directly effect the procurement element (planned order, production order, network). z Changes to the procurement element also affect the sales order. Procurement element Sales order Integration „ Schedule lines are automatically changed in the sales order. „ Changes have an affect on the assigned production order until an operation has been backflushed or until the order header has the status deleted, locked or technically completed.

67. © SAP AG LO210 3-40 © SAP AG 1999 Planning with Production Lots (SEIBAN) Planned ind. reqmts for production lots Productionlot BOM/routing MRP for production lot Planned costs for production lot PP order update Controlling per production lot Backflush per production lot Production lot actual costs BOM Explosion per production lot Production lot per component Sales orderSales order ProjectProject „ The planning of production lots provides you with the possibility of determining the costs for a product when planning (planned independent requirements) before any actual sales orders are received. All evaluations from the Project System are available (overview PS: course CA080). „ You define production lots in the master data of Material Requirements Planning. You can create a BOM and a routing with reference to the production lot. Planning, production and cost evaluation is carried out with reference to the production lot. „ When creating the production lot, a WBS element is created. Master data maintenance, planning, production and cost determination is carried out with reference to the WBS element as individual project production and planning. Two types of production lots are available for planning: 1. Production lots with individual stock: For each production lot, material stocks are managed separately in individual project stock right up to delivery. 2. Production lots with transfer posting to plant stock: Once production for the production lot has been completed, the assemblies are posted to plant stock (in a transfer posting). „ In the planning run, the system creates planned orders

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