scm_7 01 new features v2

SAP SCM Enhancements for Fashion

Customers

SCM 7 EhP 1 Sneak Preview

© 2010 SAP AG. All rights reserved. / Confidential

Agenda

1. Focus Topics in SCM 7 Enhancement Package 1

2. Enhanced Planning for Fashion Customers

3. New Process: Third-party Order Planning


Increase Value to Our Customers

Supply Chain Management provided most important

planning functionality to fashion customers

Out-of-the-box integration of AFS product modell and orders

with SCM via the Core Interface

Demand Planning

Supply Network Planning Heuristics

Capable-to-Match Planning at product level

Customers needed improved usability

Enhanced Capable-to-Match planning at both product and

SKU levels

Fashion-specific enhancements of the planners‟ user

interfaces

Support for outsourced manufacturing

Less limitations in volume and performance


Enhancements in SCM for Fashion Customers

Connectivity

SNP Aggregated Planning in

Heuristics

CTM Planning at header level

AFS Product View in Interactive

Planning

Enhanced Aggregated Planning in

CTM

Enhanced Demand Planning

Added Functionality in Interactive

Planning

Performance tuning

Third-party Order Planning

Connectivity Enhanced master data integration

Enhanced transactional data

integration – third-party orders

Faster interface

Enhancements in manufacturing

(not connected to SCM)

SAP SCM 7 EhP1SAP SCM 5.0

SAP AFS 6.5SAP AFS 5.0


Agenda





Enhancements in Aggregated Planning

Objective of the new developments

Remove limitations in aggregated planning

Increase accuracy

Add flexibility in master data

Increase visibility and transparency

Improve performance

The concept of aggregated planning has been

introduced to SAP APO

In this release, the aggregated planning does not

consider the AFS distribution profile and works

only correctly if infinite capacity is assumed.

SAP APO 5.0

With SCM 7.0 EhP1, accurate aggregated

planning in SAP APO includes the consideration of

direct shipment sales orders, the AFS distribution

profile, automatic and correct aggregation/

disaggregation

SAP SCM 7 EhP 1


Enhancements in Aggregated Planning

Functional Enhancements

Transfer of AFS distribution profile to SAP APO via CIF

Release of Forecasts from DP to SNP / Forecast Consumption

Consideration of AFS distribution profile

Forecast consumption on aggregated level

CTM Enhancements

Automatic aggregation and disaggregation

Consistent disaggregation

SNP Interactive Planning

Order changes on detailed level are aggregated automatically

Order changes on aggregated level can be disaggregated according to AFS distribution

profile, quotations or demands in the bucket.

Pegging information is shown at detailed order level and will be retained.


Transfer of AFS Distribution Profile to SAP

APO

The AFS distribution profile can be automatically transferred to SAP APO via CIF

The AFS size split is transferred to SAP APO hierarchy master data as time-dependent

location-product quota arrangements (TC: /SAPAPO/RELHSHOW)

It is also possible to manually create the AFS distribution profile

Create a distribution profile manually via TC: /SAPAPO/RELHSHOW

Ensure that the time-dependent location products used in the hierarchy are mapped for

the respective time period (TC: /SAPAPO/RELHMAPPING)

With BAdI “Reading of Time-Dependent Location Product Hierarchies“ any

determined time-dependent quotas can be read


Release of Forecasts from Demand Planning

to Supply Network Planning

Consideration of AFS distribution profile (i.e. time-dependent quota arrangements)

during the release of forecasts from Demand Planning to Supply Network Planning

The system uses the time-dependent location product hierarchy as default for

disaggregation when forecast is released from Demand Planning to Supply Network

Planning

BAdI allows using a different time-dependent location product hierarchy during forecast

release and consumption

Product

20% SKU 1

50% SKU 2

30%SKU 3

Winter 2010

Product

25% SKU 1

50% SKU 2

25%SKU 3

Winter 2011

Forecast at Product

Forecast at SKU 1

Forecast at SKU 2

Forecast at SKU 3

Forecast release


Forecast Consumption

Forecast consumption can be done on aggregated level (header product) or on

detailed level (sub-product level)

Which aggregation logic should apply needs to be defined in the location product

master data on tab “Demand”

Comparison

Forecast consumption at header level is a good choice if the size mix of future

sales can‟t be predicted and you can flexibly change size mix of procurement

Forecast consumption at sub-product level is a good choice if you know the size

mix of your future sales and you don‟t want or can change size mix of

procurement. (E.g. you use fixed assortments.)


Forecast Consumption Example

The following example explains the consumption logic:

Aggregated (header product): T-SHIRT

Forecast for T-SHIRT: 1000

Sales Orders on detailed level (size level):

– T-SHIRTS-S: 100

– T-SHIRTS-M: 200

– T-SHIRTS-L: 200

Distribution Profile:

– S 20%

– M 60%

– L 20%


Forecast Consumption Example

Consumption logic on aggregated (header product) level:

sum of sales orders on size level: 500

open forecast on T-SHIRT level = forecast on T-SHIRT level – sum of sales orders on size level = 500

open forecast is disaggregated according to distribution profile:

– T-SHIRT-S: 100

– T-SHIRT-M: 300

– T-SHIRT-L: 100

Consumption logic on detailed (sub-product) level:

forecast on T-SHIRT level is disaggregated according to distribution profile:

– T-SHIRT-S 200

– T-SHIRT-M 600

– T-SHIRT-L 200

forecast consumption happens on size level:

– T-SHIRT-S 200 – 100 => open forecast: 100

– T-SHIRT-M 600 – 200 => open forecast: 400

– T-SHIRT-L 200 – 200 => open forecast: 0


CTM Enhancements

Enhanced aggregation process for CTM

Aggregation and netting of demand based on hierarchies

CTM planning run performed on the aggregated level

The linkage information (pegging) between detailed and aggregated levels is

temporarily saved

A consistent disaggregation in a separated step respecting originating demand

ratio


CTM Enhancements

Settings in the CTM profile

“Enhanced Aggregated Planning“ on tab “Aggregation“ needs to be flagged

Hierarchies are either read from the Planning Area or can be defined in the CTM

profile


CTM Enhancements

Enhanced aggregated planning

can be activated product by

product


CTM Enhancements

Two-step Planning Process

CTM planning run on an aggregated level

In the AFS planning process, demand and supply elements are kept on the level

of the child products

In a first step, there is an aggregation and netting of demands on the header

products

A CTM planning run is executed on the aggregated level of the header product,

resulting in supply elements (stock transfer and production planned orders) on

the level of the header product

The linkage information between detailed and aggregated levels is temporarily

saved

Disaggregation step

A consistent disaggregation to the child products is performed in a separated

step based on the temporary linkage information

CTM Disaggregation is accessible via transaction /SAPAPO/CTMDIS


CTM Enhancements

CTM disaggregation can be strongly paralellized to achieve excelent system

performance

Before disaggregation, planners can check and validate results in interactive

planning



Changes on aggregated (header product) level can be disaggregated manually

according to the following:

AFS distribution profile (i.e. time-dependent quotations)

Demands

Receipts

Any logic defined via BAdI /SAPAPO/SDP_DISAGG

Order changes on detailed level are aggregated automatically



In Interactive Supply Network a selection window appears when ENTER is pressed

after a value was entered for Key Figure “Distribution Receipt (planned)”

Disaggregation logic can be determined

The results will be shown in the Key figure “Aggregated Distribution Receipt

(planned)”


Agenda




The off-shore vendor and off-shore own manufacturing model has grown significantly over

the last years led by the fashion, hi-tech, and consumer products industries. Companies

increasingly save on transportation and own distribution center handling costs by direct

shipping to end customers from vendors and factories.

Support of mid-term supply chain planning for Third-party orders considering forecasting

capabilities and finite capacities at the supplier.

VENDOR / FACTORYCUSTOMER

- Value Added Services*

and Customization

- High visibility

- High Collaboration

- Better Service

- More efficient transportation

BRAND OWNER

- Low costs of co-ordination

- Low costs of DC space

Deliver direct to Customer DC or Customer Store

Third-party Order Planning with

SAP AFS 6.5 and SCM 7.0 EhP 1

Sales Order Purchase Order

Sales Order Processing

with Direct Ship Check

Normal Sales Process*

TP-Purchase

Requisitions (unblocked)

Notes:

TP = Third-party

Only Single Sourcing for DS Orders supported

Vendor location has to be modelled in APO

Supply Chain Planning Forecast consumption

CTM planning run


using SAP AFS 6.5

Supply Chain Planning

using SAP APO CTM

Creation of TP-Purchase

Requisitions (blocked)

DS Order Normal SO

Comparison Report TP-Purchase Reqs

vs. CTM planned orders

Release of

TP-PReq to SAP AFS

Manual

Adjustments

Creation of

Purchase Order

(*) The normal sales orders are

treated in the same way as in

previous SAP AFS / SCM

releases: They can be

transferred to APO and be

delivered from a DC


Process Flow


In the Third-party purchase-to-order process, the sales person or a defined third-party

order check determines if a sales order should be handled as direct shipment order

(based for example on the product type, the customer, and the order size)

If yes, the SAP AFS system creates a blocked purchase requisition with a suitable

vendor and calculates the delivery date

In SAP APO it is checked by a CTM planning run if the vendor has capacity to supply the

requested quantity in time. This information is visualized and the Planner can decide

whether to release the purchase requisition to the SAP AFS system

After the unblocking of the purchase requisition in the SAP AFS system, the purchasing

process continues



New BAdI methods for the maintenance of sales orders and the purchase requisition creation

are provided.

The default item category is changed to "DRS" if the DRS check (BAdI implementation) is

successful. Alternatively the item category can be changed manually.

The purchase requisition items belonging to a Third-party Order process are blocked by

default.


Third-party Order Check

After creation in the SAP AFS system, the Third-party purchase requisitions are transferred

to APO via CIF.

Purchase requisition are created under Make-To-Order segment as third-party purchase

requisitions


Third-party Order Process in APO

The purchase requisition automatically creates a requirement on vendor location with the

category TP-Preq.


Third-party Order Process in APO

The forecast orders are released to the DC location and the third-party PReq‟s are situated

on the vendor location of the product. The consumption works on cross location basis, i.e.

that direct shipment orders of the vendor location consume the forecast on the DC location

The requirement strategy needs to contain the new category group „K04‟ or any other

category group which includes the ATP categories for third-party purchase requisitions.


Forecast Consumption

CTM Run creates planned orders with category SNP:PL-ORD on vendor location which are

pegged to the Third-party purchase requisitions

After the release of the pegged Third-party purchase requisition, it changes to category TP-

PR(fix) and the planned order is changed to category TP:PL-O(F)

CTM plans receipts for the non-fixed Third-party distribution demands and other demands

as for example Forecast. The fixed Third-party distribution demands and the fixed Third-

party planned orders are untouched by CTM.


Third-party Order Process in CTM

With the TP Comparison report the planner can check whether the planned supply elements

fully cover the requirements. This is visualized by traffic lights.

Based upon this information, the Planner can release the purchase requisitions to SAP AFS


Third-party Demand and Supply Comparison report

© SAP 2008 /

The status of the third-party purchase requisitions is given by traffic lights.

Green light means that the purchase requisition item can be released. This can happen

only when the supply covering the full required quantity is available for the requirement

date. (Underdeliveries are allowed up to the underdelivery tolerance). These purchase

requisition can be automatically released.

Yellow light means that the purchase requisition item itself is ready to be released, but

there are other items in the same requisition that are not. Therefore the planner needs to

make a manual decision to release the purchase requisition in question.

Red light means that the full required quantities has not been supplied OR the availability

date of at least one of the supply elements is later than the requirement date.

The completely gray traffic light icon means that the order has already been released.

You should see these types of orders in the grid only when the „Select released TP Req.‟

flag was set on the selection screen.


Third-party Demand and Supply Comparison report

© SAP 2008 /

The DRS relevant purchase requisitions are initially blocked and no purchase order can be

created against them

By the release of the TP-PReq in the TP Comparison report, the purchase requisition is

unblocked. Purchase orders can then be created against the purchase requisitions by using

the transaction ME59N

On APO side, the purchase requisitions are converted to purchase orders and the fixed

pegging to the planned order remains


Continuation of purchasing process in SAP AFS

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