SAP - PP Overview

1.  SAP AG 2000 / 1
AcceleratedSAP
Right Solution, Right Time, Right Price
PP Overview Workshop

2.  SAP AG 2000 / 2
AcceleratedSAP
Business Process Workshop
The objectives of the Production Planning Overview workshop
is to:
 Demonstrate the planning/execution process
 Discuss Company production process
 Communicate scope expectations

3.  SAP AG 2000 / 3
AcceleratedSAP
Agenda
Attendees:
 Business Managers, Process Owners
Topics:
 Master Data
 Demand
 Production Planning
 Production Execution

4.  SAP AG 2000 / 4
AcceleratedSAP
Material Master Records
 The material master is a central data object in the SAP R/3 System.
 All the information required to manage products and equipment is stored in the
material master record.
 Each user department has its own view of the material master which permits easy
access to and maintenance of data.
The material master is a
central data object in the
SAP R/3 System. The
material master includes:
•raw materials
•operating supplies
•semi-finished products
•finished products

5.  SAP AG 2000 / 5
AcceleratedSAP
Bill of Material
 A bill of material is a complete, formally structured list of the components of a
product or assembly.
 A bill of material contains the description of each component, the quantity,
and unit of measure.
 A bill of material creates the relationships between an assembly and all of
its direct components.
Motorcycle
Front
Wheel
Rear
Wheel
Frame
Brake
System
Power Train Chassis
Motor Gear Exhaust

6.  SAP AG 2000 / 6
AcceleratedSAP
Work centres
 Work centres are used to describe where and how each manufacturing
operation is performed.
 Each work centre is defined by the machines and employees involved in
the production process.
 Each work centre contains distinct capacity, costing, and scheduling
information.
Work centre 1
WC 2 WC 3
WC 4
WC 5
Work centre 6
New York Plant Shop Floor
WC = Work centre

7.  SAP AG 2000 / 7
AcceleratedSAP
Routings
 Routings describe the sequence of operations required to produce a specific
material.
 For each operation, the material components and the production resources and
tools required to produce the material are maintained in the routing.
Material
components
PRT
Operation 20
Work centre
Texts
Control data
Times
Operation 10
Material
Routing
group

8.  SAP AG 2000 / 8
AcceleratedSAP
Demo
 Create Material
 Create BOM
 Create Workcentre
 Create Routing

9.  SAP AG 2000 / 9
AcceleratedSAP
Manufacturing Planning & Execution
Costing
Inventory
Capacity
Reporting and Analysis
Procurement
Customer
Order Mgmt
Forecasting
Sales &
Operations
Planning
Manufacturing
Execution
Order
Settlement
Production Master Data
SOP MPS EXECUTION
Demand
Management
Demand
Management
MPS MRP
MRP
NEXT BACK EXIT

10.  SAP AG 2000 / 10
AcceleratedSAP
Manufacturing Planning
 Manufacturing Planning is the process of using
forecasts and customer demand to create
production and procurement schedules for finished
products and component materials.

11.  SAP AG 2000 / 11
AcceleratedSAP
Master Production Scheduling (MPS)
 Use the independent requirements from Demand Management plan to create the Master
Production plan.
 Master Production Scheduling (MPS) creates planned order proposals for each master
schedule item and generates the dependent requirements for the first-level components in
each product’s bill of material.
 The master planners review and update the suggested master production schedule before
generating a detailed production schedule.

12.  SAP AG 2000 / 12
AcceleratedSAP
Material Requirements Planning (MRP)
 In material requirements planning (MRP), the system calculates the net
requirements while considering available stock and scheduled receipts from
purchasing and production.
 During MRP, all levels of the bill of material are planned.
 The output of MRP is a detailed production and purchasing plan.

13.  SAP AG 2000 / 13
AcceleratedSAP
Demo
 Create Production Plan
 Create Sales Order
 Run MPS / MRP
 Convert Planned Order to Production Order / Purchase
Requisition
 Release Production Order

14.  SAP AG 2000 / 14
AcceleratedSAP
Production Order Execution Process
MRP
Order
Release
Goods
Issue
Completion
Confirmation
Planned
Order
Purchase
Requisition
Production
Order
Goods
Receipt
Order
Settlement
Planning
Execution
NEXT BACK EXIT

15.  SAP AG 2000 / 15
AcceleratedSAP
Manufacturing Execution
 Manufacturing Execution is the process of :
 Converting planned orders to production
orders, and releasing the orders to the shop
floor for finished products and component
materials.
 Producing finished products and component
materials and recording all shop floor activities
and inventory movements.

16.  SAP AG 2000 / 16
AcceleratedSAP
Manufacturing Execution
 Initiate Manufacturing Execution by releasing each production order to the shop
floor.
 The material handlers pick the appropriate quantities of component materials and
perform the necessary inventory transactions.
 The production and assembly operations are performed, labour is reported, and the
completed product is received into stock.

17.  SAP AG 2000 / 17
AcceleratedSAP
Order Settlement
 Order settlement is the final step in manufacturing planning and execution.
 During completion confirmations, the actual hours performed, quantities
produced, and costs incurred are confirmed.
 The plant cost analyst then closes the production order and settles any cost
balances and variances (if any) to the appropriate financial accounts.

18.  SAP AG 2000 / 18
AcceleratedSAP
Demo
 Issue Component
 Confirm at each Operation
 Receive Finished Good
 Calculate Overhead
 Calculate Variance
 Settle Production Order

19.  SAP AG 2000 / 19
AcceleratedSAP
In Scope
 Demand Management
 MPS/MRP
 Execution
 Make-to-Stock
 Discrete

20.  SAP AG 2000 / 20
AcceleratedSAP
In Scope (cont..)
•Product Costing (with qty structure)
•Capacity Planning (without Finite Scheduling)
•Standard reporting