Supply Planning Leadership Exchange: SAP PP/DS What You Need to Know Part 1


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Uncovering the Reality of SAP's Production Planning & Detailed Scheduling Module
Many companies who have invested in SAP ECC/APO are just now starting to deploy at the plant level after heavily focusing on demand and supply network planning. As a part of the SAP journey PP/DS is the next logical solution to deploy or optimize. If you’re considering PP/DS, or already have it implemented but are struggling to harness it’s full potential, you’ll benefit from this webinar.
This presentation will help people better understand;
- What PP/DS really capable of accomplishing
- Where PP/DS interacts with SNP
- How PP/DS differs from SNP
- Ways to enhance Block planning
- Why PP/DS can help manage production resource, specifically related to lead times, setup costs, delays and modes

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Supply Planning Leadership Exchange: SAP PP/DS What You Need to Know Part 1

  1. 1. Page1SUPPLY PLANNING LEADERSHIP EXCHANGEPRESENTS: The web event will begin momentarily with your host: November 15th , 2012 plan4demand
  2. 2. OverviewWhat are the PP/DS ComponentsWhat does PP/DS really accomplishWhat should it mean?– Optimizing , Block PlanningPP/DS – Step by Step– PP Heuristics Planning– DS Optimization– Set up MatrixBottom Line
  3. 3. Clearly Define the PP/DS Components andFunctionalityDifferentiate Between Heuristics and OptimizerIdentify common Block Planning and Set up MatrixrequirementsDiscuss some specific actions that can help you start toget this difficult process under control and understoodin your organization
  4. 4. • Demand Plan • Supply Plan • Rough Cut Capacity Plan• S&OP Forecast • Production Plan• Annual Operating Plan Tactical • Finite Plan & Schedule (Budget) • Labor Plan• Standard Cost• Brand Plan • Materials Plan• Strategic Logistics Plan • Set Up Matrix Operational Strategic • Strat Plan • CapEx Plan • Portfolio Plan/Product Roadmap • IT Roadmap
  5. 5. Page 5 PP/DS is primarily divided in two areas Release Demand Run SNP Optimizer to Plan to SNP produce Supply Plan * Depending on the business Production Planning requirement may require more than * PP heuristics one run (Production Plan) Convert supply elements Orders * DS Heuristics (production or purchase ) (Detailed Feasible Plan) Interactive detailed planning in DS planning board. Detailed Scheduling
  6. 6. Page 6 Features Key Benefits – Multi-Level Production Plan – The How, When, and Where – Capable-to-Promise resources and materials should be deployed. – Supports lot quantity calculations – Master Planning for Materials and capacity (Resource Loads) – Supports the following business models – Realistic Delivery Date confirmation  Make to Stock  Make to Order  Make to Order with Order BOM  Engineer to Order  Flow Manufacturing – Order Pegging – Integrated with Alert Monitor
  7. 7. Page 7 Features Key Benefits – Scheduling Optimizer – Optimal production sequence – Optimal Sequencing (feasible and executable) – Flexible & Graphical – Allows simulation of planning scenarios for optimal schedule Activity Scheduling – Optimization based on actual – Backlog Resolution constraints Planning – What-If Analysis & Simulation – Forward & Backward Scheduling
  8. 8. Release from SNP to PP/DS ECC APO PP Heuristic & PP Optimizer CIF Sales Orders Stk. Trnsfr. Orders Inventory Process Orders Evaluate the Planning Purch. Orders Results Execution: Interactive Planning: Create,Process Order Release Change, Reschedule Orders in & Production the Planning Board Confirmation
  9. 9. Elements that compliment PP/DS Alert Monitor (Exception Management) Heuristic Framework (User Friendly Development Area) Simulation versions (What If ) Standard Reports (Several Standard Reports) 3 6 5 4 2 1 time
  10. 10. Page 10 Application of rules Customer-specific rules using the Heuristic Framework Scheduling result is easier to understand and influence Mostly limited to one bottleneck resource (except for Multi-Level Heuristics) Only applicable to scheduling problems with limited (modeled) complexity (e.g., no loops) Better suited for workaround solutions if constraints cannot be modeled properly Heuristic finds only one solution which is always a result of the sequence of products or resources planned. There are winners and losers in Heuristics. It is a step by step procedure
  11. 11. Page 11 Sequence Optimization Simultaneous consideration of multiple operations, resources, and BOM levels Suited for complex (modeled) scheduling problems Better suited if there is an optimization potential which cannot be described by simple rules – e.g., if the structure of the scheduling problem changes depending on the order mix Scheduling result are more difficult to understand and influence Helicopter view over all resources and products and plans. – A problem at one end of the resource network – Caused by a good solution on the other end of the resource network – Optimizer can go back and solve the issue over the whole network and come up with a solution that is feasible for all resources in the network. Heuristic would have to have reiterate runs with readjustment to runs and the problem moving around the resource network .
  12. 12. Page 12 Optimizer – The benefit of minimizing sequence dependent setup times, reducing lead-times and to schedule dependent demand according to the priority of the demand. Pegging Constraints & Shelf Life are the most common and complicated requirements Optimization: Change of Production dates/Sequences and resource assignment of existing operations/activities with regard to the following criteria (no creation or deletion of orders) © SAP 2012
  13. 13. 13 Demand Planning Final Forecast (12 Months) per product family (CBF)SNP Engine HEURISTICS CAPABLE TO MATCH OPTIMIZER Run with a • Plans the whole Network (Multilevel Planning) Run in the sequence of the pre-defined predefined • CTM can execute Bucket and Time Continuous Planning production cycle considering the following: Horizon *Storage cost • Mixed Resources can be used by SNP with bucket and time continuous definitions *Order Cost (production cost & setup cost) •Capacity • Prioritize demand and categorize your supply accordingly *Profit Margin Leveling must be run to • Block Planning - considers characteristic values of orders *Penalty of Late orders achieve a during planning and creates orders with corresponding characteristic values relevant for variant configuration or *Non-delivery somewhat constrained for characteristics-dependent planning (CDP) *Procurement cost capacity plan • Planning with products configured for CDP, considers The result: the Optimal Production Quantity for block definitions of resources and fixed blocks. the Product Family Prod. Qty is transferred to The Optimal Production Quantity is the preliminary size of the block. PP/DS PP/DS to create the Blocks This determines the frequency of the block in the production cycle. Create Blocks in Resource Master. Generate week schedule for the Production Lines.
  14. 14. Private party on Saturday….. No SNP make the following decisions. SNP Orders – Take place in Planning Periods or Buckets  Source of Supply – No defined sequence  Approximate Production Date – Lot sizes correspond to Maximum quantity  Quantity for Planning Period SNP: Planned orders in PPDS: Calculates daily, hourly weekly buckets schedules SNP order(Bucketed Order) 100 SNP horizon Last Week PP/DS Horizon SNP planned orders in the SNP horizon will be converted to detailed schedule (PPDS orders) W1 W2 W3 W4 W5 PP/DS Horizon SNP horizon Today 100 W2 W3 W4 W5 WK6 Conversion of Detail Plan Optimization / PP/DS order - (continuous time scale with to Process orders Sequencing start time and end time)
  15. 15. Page 15 The SNP and PP/DS differences
  16. 16. Are you running or planning to run PP/DS on a single or multiple plants? Answer on the right hand side of your screen A. Single B. Multiple
  17. 17. 17 © SAP 2012
  18. 18. Page 18 © SAP 2012
  19. 19. Customer orders Blocks Shift schedule t Requirement get automatically scheduled according to blocks schedule© SAP 2012
  20. 20. Page 20 A Matrix contains – For each possible setup transition at a single resource  The setup times  The setup costs that are necessary to change the setup status of the resource to another setup status. You can use a setup matrix to model sequence-dependent setup times and setup costs for a single resource. Based on the setup matrix, the system will do the following: – Determines the correct setup – Determine optimal operation sequences (with regard to setup time or setup costs) during optimization – Determine the production process model for creating a setup order and clean-out order during campaign optimization
  21. 21. Prod A Prod B TimeMaintain Setup Matrix- Prod A Time Prod C/n/sapapo/cdpsc7Display Setup Matrix- Prod B Time Prod A/n/sapapo/cdps_setup Prod B Time Prod C Prod C Time Prod A Prod C Time Prod B
  22. 22. Setup Group: Classification of an operation according to a characteristic that is relevant to planning and which the system should consider during scheduling and rescheduling.Maintain Setup Group- Group A Time Group B/n/sapapo/cdpsc6 Group A Time Group C Group B Time Group A Group B Time Group C Group C Time Group A Group C Time Group B
  23. 23. While performing detailed scheduling– System will read the setup matrix that defines the sequence- dependent setup time. Demand A C B A Setup time on resource Setup time in minutes Prod. A B C Product A: A 0 10 20 B 30 0 10 Product B: C 40 30 0 Product C:Finite Schedule time 20 30 30 A Setup C Setup B Setup AOptimal Schedule Set- Set- A A up B up C 10 10
  24. 24. What is the level of constraints you currently face in your production environment ? Answer on the right hand side of your screen A. High Fixed Constraints B. High Variable Constraints C. Medium Fixed Constraints D. Medium Variable Constraints E. Low Fixed Constraints F. Low Variable Constraints
  25. 25. Page 26 Graphical User Interface – Drag and Drop – Drill Down to the lowest Level – Work Area – Navigation Area © SAP 2012
  26. 26. 27 Shows the planning elements graphically in a highly customizable interface Reports can be triggered on the fly. © SAP 2012
  27. 27. 28 Interactive What If analysis can be adopted for the actual planMultiple schedules can be developed and then merged with the active plan © SAP 2012
  28. 28. 29 Opt: Run what if analysis if extended the blockRequirement/Receipt Alerts: Re-schedule if the block is adjusted. – Product Too Late/Early Setup PP/DSShelf Life Alerts: Alert Profile Custom Capacity Alert Sent to – Shelf Life too short/ long the planner (e.g. 70% ). – Receipt with out Pegging Relationship Run PP/DSOrders in Past Alerts: Planning – Sales Order in the past – Receipt due date/time in past. Adjust PlanOrder Alerts-Product Dependent: Interactively View Alerts – Order creates surplus – Order has shortageDays’ Supply Alerts: Notify Person Analyze Alert – Below minimum days’ supply Responsible Situation – Required days’ supply exceededAverage Resource Utilization(PP/DS): – Average resource overload Action – Average resource underutilization 1. Do nothing. – Capacity overload on bucket resource 2. Extend the block. 3. Fix the block.Inventory Alerts: 4. Yell at Demand Planner for the forecast being too high. – Stock fallen below safety stock level
  29. 29. Page30 PP/DS fulfills the need of production planner by – Creating feasible plan taking into consideration constraints – Provides the tools needed to plan and schedule Insure a crisp transition from SNP to PP/DS – SNP should do the heavy lifting with PP/DS putting the icing on the cake – Insure high transparency between SNP and PP/DS Understand the type of scheduling you what to do – Block, Campaign … Understand the engine that will drive your PP/DS – A large variety of heuristics are available to plan products – The ability to build your own Heuristics
  30. 30. Join us on LinkedIn: Supply Planning Leadership ExchangeFollow us on Twitter: @Plan4Demand Complete our Survey & receive a $5 Starbucks Gift Card Upcoming Leadership Exchanges Save the Date! December 5th December 14th S&OP Leadership Exchange: Special Event S&OP KPIs & Metrics Setting a course to achieve ROI
  31. 31. For More Information Contact: Jaime Reints