Course Objective

• Understanding of SAP APO.

• Understand the underlying components of Demand Planning (DP) &

Supply Network Planning (SNP)

• Provide a high level understanding of the interfaces between DP, SNP

and other APO modules as well as SAP R/3.

OLTP

R/3 R/3LegacyOLTP

Non R\3OLTP

Non R\3OLTP

Application Link EnablingModel Generator, Mapping, Connectivity

BW

APOSolvers

APO

liveCacheliveCache

DemandPlanning

PP/DSTPVSSupplyNetworkPlanning

AvailableTo

Promise

SC Cockpit

SAP APO Architecture

R/3R/3 APOAPO

GlobalATP

GlobalATP

DeploymentDeployment

SAP-BW

HistoricalData

KeyPerform.

Indicators

External Data

(e.g. POS)

SAP-BW

HistoricalData

KeyPerform.

Indicators

External Data

(e.g. POS)

Demand PlanningDemand Planning

SalesOrders

ManufacturingExecution

InventoryManagement

ProductionPlanning anddetailedScheduling

SupplyNetworkPlanning

SupplyNetworkPlanning

APO Applications and Data Flow

Integration to APO

Advantages of APO

SAP AG 2001

Advantages of APO

High performance using liveCache technology

Global server: integrates multiple OLTP systems

Collaborative planning via the internet

Simultaneous material and finite capacity requirementsplanning

Cross-plant optimization of the resource load

Sequence and setup time optimization of orders

Transportation optimization with route planning

Evaluation and analysis of orders

Seamless integration between APO and R/3

Master Data versus Transaction Data

Master Data Transaction Data

What is it Static data used during planning

Data dynamically created through planning and execution

Examples Products, Production Lines, Locations

Forecasts, Sales orders

Used for Mapping organization to the system

Captured information flow

Where does it reside • Data shared between R/3 and SCM

• Is shared between SCM components - APO, ICH, EM

• Data created either in planning or execution systems. Planning relevant visible in APO.

Mapping of Master Data Objects

R/3 APO

Location

Product

Resource

Production process model

R/3 master data APO master data

Plant

Customer

Vendor

Material master

Work center

Routing and

Bill of material

Special Procurement Key

Transportation Lane

Mapping of Transaction Data Objects

R/3 APO

Order category

PchOrd (BF)

PurReqs (AG)

SalesOrder (BM)

PlOrd. (AI)

FC req. (FA)

Stock (CC )

R/3 transaction data APO transaction data

Purchase Orders

Purchase requisitions

Sales orders

Planned orders

Planned Ind. Reqmts.

Supplies

Production Orders Prod Ord (AJ)

…..

APO Master Data (model independent)

Planning Model 000- Master data assigned to model

Planning Model n- Master data assigned to model

Planning Version n

- version n dependent transactional data

-version n dependent master data

Non-IntegratedNon-Integrated

SNP What if outputSNP Output

Planning Version 000

- version 000 dependent transactional data

-version 000 dependent master data

IntegratedIntegrated

LegacyLegacyLegacyLegacy R/3R/3R/3R/3 OLTP Master Data

Models and Planning Versions

Planning Books and Data Views

APO master data

Model 000 Model 1

Version 000 Version A Version B

Planning areas

Planning books

Data views

APO - Supply Network Planning

SAP AG 2001

Supply Network Planning Scenario

SNP plans the material flow along the supply chain

Mid- to long-term, finite, cross-plant planning

Prioritization of demands; supply optimization

Result: Feasible plans

Demand Plan

Supplier Plant DC Customer

Supply PlanningSupply

PlanningOptimal

Supply PlanOptimal

Supply Plan

Demand• Forecast• Orders

Material Constraints• Material availability• Supplier lead times

Production Constraints• Lot sizing rules• Equipment capacity• Labor

Distribution Constraints• Distribution lead times

Supply Chain Cost Info• Production cost per location• Transportation costs

• Maximize order fill rates• Minimize inventory levels• Minimize costs

The supply plan specifies what to make/move, where to make/move it, how much to make/move and when to make/move it

Objective: To produce effective supply plans which simultaneously reduce costs/assets and improve customer service by dramatically improving the ability to process/incorporate all relevant supply chain information

Objective: To produce effective supply plans which simultaneously reduce costs/assets and improve customer service by dramatically improving the ability to process/incorporate all relevant supply chain information

Supply Planning

• A planning approach to create tactical plans and sourcing decisions that takes the complete supply network into consideration

• Model the entire supply network and related constraints

• Create rough quantity based, cross location production and distribution plan with individual rough bill of material (BOM) and routings

• Integrate purchasing, manufacturing, distribution and transportation in one consistent model

• Create feasible plans for purchasing, manufacturing, inventory and transportation

• Synchronize activities and plan material flow throughout the supply chain

APO - Supply Network Planning

SNP Process

Perform SNP Planning Run

Finalize SNP plan Run Alerts/Check planSolve problems

ReleaseSupply plan

SNP configuration

Release demandplan to SNP

Set up master data

Set up supply chain model

• Multi-site mid-term rough-cut planning

• Simultaneous material planning and finite capacity planning of production, storage and transportation resources

• Simultaneous production planning and distribution resource planning

• Planning of critical components on bottleneck resources

• Cross-plant optimization of the resource load

• Prioritization of demand and supply

• Collaborative procurement planning via the internet

Benefits of Supply Network Planning

SNP Planning Methods (Solvers)

• SNP Heuristics• Un-constrained• MRP Like• Capacity leveling

• Capable to Match (CTM) : Supply to Demand Match• Feasible solution• Matches demand to available supply via production capacity

and transportation capability check

• SNP Optimization: cost-based optimization• Feasible solutions• Optimization of production, transportation, and inventory costs

Supplier WH

ManufacturerDC

Customer DC

Production plant

Supplier plant

SNP Heuristics

• MRP II concept (planning against infinite capacity)• Rapid multi-site planning• Does not necessarily develop a feasible plan• Additional step required for capacity leveling

1. Day 2. Day 3. Day 4. Day 5. Day

Capacity load

100 %

200 %

SNP Optimizer

Sourcing Production &Purchasing

requirements,Inventory levels

Sourcing Production &Purchasing

requirements,Inventory levels

Flexible Constraint Definition capacity constraints material constraints transportation constraints ….

Optimization

Supply feedback toDemand Planning

Supply feedback toDemand Planning

$

Goal: Minimize costs

ForecastsCustomers orders

ForecastsCustomers orders

Control costsPenalty costs

•Production•Transportation•Procurement•Storage•Safety Stock•Non-Delivery•Delay

Costs

Capable to Match (CTM)

• CTM is a rules-based, multi-site planning method that takes finite considerations of production resources

• Extensive prioritization capabilities control the planning process

• Satisfies prioritized customer requirements with multi-site capacity leveling when there is a capacity overload

SNP Capable To Match (CTM)

• Simultaneous material and capacity planning• Categorization of demand and prioritization of supply • Considers costs

• Transportation• Production

• Considers priorities• Product• Location• Product/Location• Transportation Lane

• Considers Quotas • Rule definition possible

1. Day 2. Day 3. Day 4. Day 5. Day

Capacity load

100 %

CTM Planning Scenario

Integration of Supply Network Planning (SNP) with Demand Planning (DP) & Production Planning & Detailed Scheduling (PP/DS)

Sales History

Market Info

Demand Planning

(Batch & Interactive Forecastin

g)

ForecastSupply

Network Planning

(Reads Network Demand- feasible)

Sales Demand (OLTP)

Stocks

Constrained based SNP plan

Sales History

Market Info

Demand Planning

(Batch & Interactive Forecastin

g)

Forecast

Supply Network Planning

Sales Demand

(R3)

Stocks

Rough cut Location Production plan

Rough Cut Location Procuremnet plan

Constrained based SNP plan

Release to PP/DS

Thank You