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Demand Management - SAP PP Implementation

Demand Management   Process Definition Demand Management determines requirement quantities and delivery dates for finished prod... thumbnail 1 summary

Demand Management

 

Process Definition

Demand Management determines requirement quantities and delivery dates for finished products assemblies. To create a demand program, Demand Management uses Planned Independent Requirements and Customer Requirements. Planned Independent Requirements (PIRs) are used to determine the quantities of a material required in a particular time period. The PIRs could be both manually maintained or determined using Sales and Operational Planning. Customer Requirements represents the Sales Orders in the system. Once a sales order arrives, the PIRs are reduced.

Planning Strategy

To create the demand program, a planning strategy has to be defined for a product. Planning strategies represent the methods of production for planning, and manufacturing or procuring a product, which are assigned in the Material Master of that product. A planning strategy determines if production is triggered by Sales Orders (make-to-order production), or if it is planned independently without having Sales Orders (make-to-stock production).
At MYCOMPANY, strategy type “Planning with Final Assembly-40” would be used. In this planning strategy, procurement and production of all components and assemblies including the final assemblies are initiated on the basis of planned independent requirements before sales orders are received but Sales orders affect requirements and consume planned independent requirements of the finished product. If the costumer requirement quantity exceeds the planned independent requirements then a planned order is automatically created for the unplanned quantity during the next MRP run. Sales orders consume Planned Independent Requirements (PIRs) as defined by the consumption mode and consumption period.
At MYCOMPANY, Make to Stock planning strategy is followed. Make-to-stock strategy is used when stocks are produced independently without a direct reference to a sales order. The requirements from the sales orders are met from those stocks. For this strategy production would be based on the sales forecast. This means that make-to-stock strategies can support a very close customer-vendor relationship because the objective is to provide customers with products from stocks as quickly as possible.

Creation of Active version: Production Plan (Rough Cut Capacity Planning - RCCP)


Process
Description
Process owner
Triggering event
Run RCCP and create PRODUCTION plan
The planning Manager would CHECK capacities using the version 200; demand plan. If the capacities were available, the planning Manager would copy the demand plan and save it as the production plan. This production plan thus created would be saved as version 300 and would become the input for the MRP run.
Planning Manager
Creation of Demand Plan: version 200.
Edit Demand Plan; Version 200
The planning Manager would CHECK capacities using the version 200; demand plan. If the capacities were not available, the planning Manager in collaboration with MSD would edit the Demand Plan and update the version 200 i.e. inactive version.
Planning Manager
RCCP check fails. 


The planning Manager would check rough cut capacities using the Demand plan; Version 200. If the capacities are not available, the planning Manager would edit the Demand Plan. If the capacities were available, the planning Manager would copy the Demand plan as Production plan; version 300. As soon as the planning Manager saves the production plan, the planned independent requirements are automatically generated.



Planned Independent Requirement (MPS)


The planned independent requirements provide the information that which finished materials are to be produced, when these should be produced and in what quantities. The PIRs would be created automatically as soon as the planning Manager saves the production plan; version 300.

 

Splitting Planned Independent Requirement:


Process
Description
Process owner
Triggering event
Splitting of monthly PIRs into weekly PIRs.
Planning Manager would run splitting of PIRs.(MD67: Staggered Split)
Planning Manager
Creation of Planned Independent requirements (PIR).
The splitting results in weekly forecast that becomes the input for the MRP run.

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